BoE delivers message Britons don’t want to hear as inflation – and rates – look set to rise
The US-Israel attack on Iran has already driven prices higher and not just at the petrol pumps, the Bank of England said on Thursday in a gloomy assessment of the UK’s economic outlook.An inflation rate that was on track to fall from 3% to the Bank’s 2% target in the coming months is now expected to rise to 3.5%.That is one probable impact of the US and Israel’s war on Iran.Higher transport and energy costs can quickly flow through to higher food prices, ratcheting up the consumer prices index when the previous trajectory was down.
It is not the news households wanted to hear after a long period of high inflation that everyone thought was over.Likewise, businesses large and small will be reconsidering their investment decisions and how many people they hire as a result.For the government, another rise in the cost of living is the last thing it needs heading into already difficult local elections.The monetary policy committee (MPC) stopped short of making any predictions but the unanimous decision to hold interest rates at 3.75% is a signal that the thinking inside Threadneedle Street is moderately panicked.
MPC members are looking in both directions at once,One of them, Alan Taylor, who has warned against raising interest rates to deal with an externally induced price shock, said the pause signalled nothing more than a moment of contemplation,But his was almost a lone view,While Swati Dhingra, like Taylor, has warned that the weakening economic outlook means inflation will fall over the longer term and for that reason has been a consistent supporter of lower interest rates, she said she would be prepared to raise rates if the war continued and inflation became more embedded,Officials are weighing up, on the one hand, how much workers can ask for in higher wages to compensate for higher inflation when unemployment is high and hiring is low.
Coupled with this, businesses may seek to recover increased costs in the form of higher prices, especially in areas of the economy where competition has eroded or consumers are resigned to another inflation spike.And on the other hand, an increase in the sensitivity of households to another bout of inflation – one that brings a decline in living standards – may trigger a big push for higher wages across the public and private sectors.Like other central banks, the Bank of England sees both trends potentially dominating and wants to watch and wait.It may be that the logic of the war – that Iran can plausibly shut the strait of Hormuz for many more months with just a few drones – is the only relevant piece of information the MPC needs.It means oil prices will stay high into the summer and interest rates, despite the damage they will cause, are likely to rise.
Financial markets certainly think so and are now betting that the Bank will raise rates as soon as June.
Watchdog takes over running of home for adults with learning disabilities
The charity watchdog has taken control of a learning disability care home in Northamptonshire that is under investigation after residents’ families raised concerns over its management, including payments of £1m to a trustee.The Charity Commission has appointed an interim manager to run William Blake House, which faces potential insolvency in three weeks’ time if it cannot head off a winding-up order brought by the tax authorities over £1.6m in unpaid tax bills.The move, which freezes out the current board of trustees, is a victory for an activist group of families whose adult children are residents at the home. They campaigned for change after discovering the parlous state of the charity’s finances last autumn
Women and girls bearing brunt of water shortages globally, UN warns
Women and girls are bearing the brunt of water shortages and a lack of sanitation around the world, hindering the economic and social development of poorer countries, the UN has warned.Women are responsible for collecting water in more than 70% of rural households that do not have access to mains water across the developing world. Women and girls collectively spend 250m hours a day collecting water globally.The climate crisis is exacerbating the problem, according to a new report from the UN. A 1C rise in temperature reduces incomes in female-headed households by 34% more than in male-headed ones, while also causing women’s weekly labour hours to increase by an average of 55 minutes relative to men’s
Kent meningitis outbreak has been contained, health officials believe
Health officials increasingly believe they have contained the fatal outbreak of meningitis in Kent, with no cases emerging that are not linked to the original cluster of 20.In another boost to efforts to contain the infection, the bug that caused it has been identified as a known strain of meningitis B, the Guardian understands.That should mean that the MenB vaccine offered to 5,000 students living in University of Kent halls of residence in Canterbury, hundreds of whom received it on Wednesday, will prove a good match.There is growing confidence among the NHS, the UK Health Security Agency (UKHSA) and county council public health staff tackling the outbreak that the people infected in Kent, many of whom visited a nightclub on 5, 6 or 7 March, have not passed it on to anyone outside the area.“All cases to date are linked to the current outbreak in Kent,” a UKHSA spokesperson said
AI software for smart glasses wins £1m prize for technology to help people with dementia
AI software that can be embedded into smart glasses has won a £1m prize for technology to help people with dementia.Built into chunky, black-rimmed frames that have a camera, microphone and speakers, the tech – known as CrossSense – guides wearers through everyday life by means of a chatty assistant called Wispy.Not only can Wispy offer prompts and feedback during tasks – through verbal cues and text that floats in front of the wearer’s eyes – but it can also ask questions, engage in light conversation and aid reminiscences.The software has won the Longitude prize on dementia, one of a number of awards designed and delivered by Challenge Works and supported by Nesta.Funded by Alzheimer’s Society and Innovate UK, the prize aimed to encourage the development of technology to help people with dementia stay independent for longer
Playing with dolls can help children develop imagination and social skills – UK study
Playing along with dolls can help boys and girls develop more sophisticated imaginations and better social skills, compared with children who play on electronic devices, according to research.Psychologists at Cardiff University and King’s College London found that children given dolls gained a richer appreciation of other people’s beliefs and feelings, in contrast to those given a tablet loaded with video games.Parents also reported that the children, aged between four and eight, were more likely to play alone when using the tablet, while those with dolls were more likely to play with friends or family.Dr Sarah Gerson, the lead author and a reader in psychology at Cardiff, said: “We believe that doll play may encourage children to engage in social interactions more and give children more opportunities to rehearse or reflect on others’ beliefs, emotions, or intentions, compared to other types of play.“When playing with dolls, children have the opportunity to role-play characters, create narratives, and act out scenarios – doing so relies on and fosters the ability to imagine others’ thoughts, feelings, and intentions
Having my ears syringed left me with tinnitus | Letter
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