Thanks for your comment! This is an important aspect of the inflation stabilization problem. Not just in the U.K, but elsewhere as well. Price levels on necessity goods is more important than the disinflation towards the target.
Actual rents for housing still rising at over 6% is a big element of the 'vibecession'. For young people unable to get on the housing ladder, especially in the South East, rents take a huge chunk of their disposable income, so even if the average person is experiencing rapid disinflation, for this important group the vibe is still very negative.
And, of course, the average person wants their grocery bill to go back to where it was in 2019, not just to see it plateauing, or even resuming a 2% long-term average again. I always think this is where central bankers just don't 'get it'. They live in a constant, morbid fear of deflation, a state unique to macroeconomists and bankers.
Thanks for your comment! This is an important aspect of the inflation stabilization problem. Not just in the U.K, but elsewhere as well. Price levels on necessity goods is more important than the disinflation towards the target.
Actual rents for housing still rising at over 6% is a big element of the 'vibecession'. For young people unable to get on the housing ladder, especially in the South East, rents take a huge chunk of their disposable income, so even if the average person is experiencing rapid disinflation, for this important group the vibe is still very negative.
And, of course, the average person wants their grocery bill to go back to where it was in 2019, not just to see it plateauing, or even resuming a 2% long-term average again. I always think this is where central bankers just don't 'get it'. They live in a constant, morbid fear of deflation, a state unique to macroeconomists and bankers.