More on British inflation

April 17, 2024 Leave a comment

I am posturing for higher #inflation rates, again.

My expectations (found in my historical posts) for ‘lower’ inflation has occurred and is as good as being completed.

Following up my note dated April 11, 2024, suggesting the irrelevance of the U.K. March inflation report,

U.K. inflation to see 5%, not 2%

While inflation has abated, now it doesn’t matter so much whether this month’s #UnitedKingdom inflation rate of 3.2% is lower than last months (year on year) figure of 3.4%.

Keep in mind, that prices are still rising and I think that is mostly a cause of capacity and supply constraints rather than notable demand.

My thinking is that #UK inflation will move to 5% rather than 2%.

Slowing demand means companies will increases prices for goods and services, in order to maintain their shrinking margins.

April 17, 2024

by Rob Zdravevski

rob@karriasset.com.au

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U.K. inflation to see 5%, not 2%

April 11, 2024 Leave a comment

It doesn’t matter if the March 2024 #UnitedKingdom inflation rate falls from 3.4% down to 3% or 2.6%……

This is small beans.

It is nearer the lower end of its travels.

The big call to make is when the #inflation rate is trading at ‘extremes’ to my illustrated moving average, appearing in the chart below.

Much like my American inflation note published yesterday, I think there is greater probability that #UK inflation rate should travel towards 5% rather than 1.8%……

and all that comes with it for interest rates and the equity prices of high growth (unprofitable) companies.

Incidentally, the U.K. inflation rate for March 2024 is due to be released on April 17th.

April 11, 2024

by Rob Zdravevski

rob@karriasset.com.au

Karri Asset Advisors

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