The Bank of Russia unexpectedly maintained its key interest rate at a record-high 21% , defying analysts’ expectations of another significant hike as inflation remains stubbornly elevated. The decision marks a shift toward a more measured approach in balancing economic growth and price stability. Key Details Inflation Concerns: Annual inflation climbed to 8.9% in November, well above the central bank’s 4% target , with inflation expectations reaching 13.9% in December. Policy Rationale: The central bank cited the significant tightening of monetary conditions after October’s 200-basis point hike as sufficient to resume disinflationary processes. Governor Elvira Nabiullina emphasized avoiding both economic overheating and severe slowdowns. Economic Overheating: Elevated government spending on the war in Ukraine and social programs, coupled with labor shortages and rising wages, have fueled strong domestic demand, exacerbating price pressures...
New British finance minister Rachel Reeves has announced the need to raise taxes in her upcoming October 30 budget, confirming the anticipated move following a recent revelation of a £22 billion (RM130.41 billion) budget shortfall.
Key Points:
- Tax Increase Announcement: Reeves stated the necessity of tax hikes during an interview with The News Agents podcast, marking her first explicit confirmation of the move since assuming office after the Labour Party's election victory on July 4.
- Budget Shortfall: Earlier this week, Reeves highlighted a £22 billion shortfall in this year's budget, necessitating difficult decisions.
- Tax Details: While specifics on which taxes will be raised were not disclosed, Reeves reiterated her commitment to not increase rates on income tax, National Insurance, value-added tax, and corporation tax.
- Spending Cuts: The announcement of tax increases follows £13.5 billion in spending cuts over the next two years, revealed on Monday. Reeves attributed these cuts to what she described as the previous Conservative government's obfuscation of the true state of public finances.
- Political Context: The Conservative Party, which had been in power for the past 14 years, denied these allegations, asserting that Labour had always intended to raise taxes.
Reeves' comments solidify expectations of upcoming fiscal adjustments as she navigates the complexities of managing the UK's public finances in her new role.
Comments
Post a Comment