mann International Boe Warns On Uk Stagflation...

Mann International analysts believe that there is more danger to the UK economy from runaway inflation than there is a risk that the recovery will wane if interest rates are raised.

The analysts suggest that the recovery is going to stall at some point and there is little that can be done to prevent it so the Bank of England should consider raising interest rates.

Mann International issued the statement after the Governor of the Bank, Mervyn King, told a committee of UK Members of Parliament that the country was at risk of suffering from a bout of stagflation, a term that describes an economic condition where GDP remains stagnant or barely increasing but retail prices soar.

The firm believes that the Bank of England may be forced to restart its quantitative easing program in order to create the money the government needs to function and that this will almost certainly increase inflationary pressures whilst battering sterling on the foreign exchanges.

Mann International analysts said that there is little doubt that interest rates are likely to remain low for far longer than most economists expect and investors should not read too much into sterlings recent recovery.

The UK is still in serious trouble and it remains to be seen how the economy deals with the very real prospect of a double dip, one of the analysts said.

Mann International said that key market participants remain skeptical of the tests owing to their lack of adequate information on the hypothetical scenarios being tested.

The firm conceded that, for the most part, the markets appeared to have taken a positive view of the process but one analyst said Uncertainty remains in sufficient quantity to render the entire exercise irrelevant and, frankly, this has been the case with the EU in several instances including the bailout of Greece and the European Financial Stability Facility. Nobody understood how any of it was going to work.

Mann International believes that the most important question the markets wants answers to is the effect of a sovereign default on one or more banks but the EU authorities have been reluctant to provide an indication of what kind of haircut or level of restructuring it is applying in the tests.

About the Author:
Josh Phillips reporter
http://www.manninternational.com

Article Originally Published On: http://www.articlesnatch.com

Tags: Mann International

, MannInternational

, manninternational

Related....

Videos...

Recent Finance Articles

Ppi Is Not All Bad By: Colin Hartness | May 22nd 2012 - There has been much debate over Payment Protection Insurance (PPI) after it was found that the product was missold to hundreds of thousands of people in the UK. Whilst the product can be a great financial protector for those buying it in the right way, missold ...

ppi benefits

ppi claims

ppi reclaim

payment protection insurance

ppi

Are Texas Health Insurance Plan Premiums Increasing? By: Wiley Long | May 22nd 2012 - Rate reviews are required by the federal government in an attempt to justify unreasonable rate hikes on Texas health insurance plans. How are the rate reviews helping the residents of Texas?

Texas health insurance

Texas health insurance plans

health insurance for Texas

The Basics Of Financial Analysis By: homerbooker | May 22nd 2012 - Financial analysis is not as hard as you think in its basics. Read this article to get familiar with it.

Springhill Group: Dprk Jams Gps Of Rok Airlines By: springmed | May 22nd 2012 - GPS jamming signals coming from North Korea has forced South Korea to order its military and civilian air transports to switch on alternative navigational devices to avoid disruption.

Cash Management "�" Making Cash Flow Projections By: atsulivan | May 22nd 2012 - In this interesting article you can read about cash management and it's advantages.

Balancing Between Austerity And Growth In Eu"��rajesh Sharma Money Matters By: Balaji | May 22nd 2012 - Rajesh Sharma CMD Money Matters Financial Services Ltd. said in the medium and longer term minimum austere medium-term fiscal targets need to be offset by higher nominal growth. As we noticed that structural reform can ease external rebalancing so are reforms ...

Rajesh Sharma Money Matters

Money Matters Financial Service

Keep Your Tax Refund By Hiring Certified Professional Accountants By: Shams Ur | May 22nd 2012 - Accountancy bodies are providing the best services to their clients. They keep up the big accounts of locum doctors and other health professionals. The Certified Professional Accountants will give useful advice to deal with complex tax affairs and get more tax ...

Accountants for locum doctors

Tax refund

The Right Services For Asset Protection By: Bruce L. Rinda | May 22nd 2012 - Currency is a medium of exchange and paper currency is a common form of legal tender in many countries. There are many forms of currencies such as complementary currency, local currency, auxiliary currency and private currency.

currency account

multi currency account

International currency account

foreign exchange

international payments

Businesses And Debt Management By: Johnson King | May 21st 2012 - Most of the business owners need financial help to conduct their business whether it's on a large scale or a small scale. Financing arrangements in the form of unsecured/secured loans is a frequently used method for meeting business operations and expanding it ...

Insolvency solicitors

Insolvency advice

Insolvency

India Cpi Flash - Rajesh Sharma Money Matters By: Balaji | May 21st 2012 - CPI April number Crosses 10%, It gets tougher for RBI on policy decision..says Rajesh Sharma Money Matters CMD. New CPI gives jitters approximately increasing by 100 bps (A basis point (often denoted as bp, colloquially referred to in the plural as "bips ...

Rajesh Sharma Money Matters

Money Matters Financial Services Ltd

Comments

Still can't find what you are looking for? Search for it!

Site Navigation: