Tensions, both in the United Kingdom and in overseas countries, appear to have markedly increased over the past year and a half. Taking a somewhat longer perspective than has been usual in the recent past, this commentary offers a review of economic developments over this period.
Inflation in the United Kingdom has accelerated sharply from its low point in 1978, although many special factors account for much of the 22% rise in retail prices over the year to May 1980. In these circumstances, it becomes all the more important to control the growth of the money stock, and to maintain assurance of underlying monetary stability. At the same time, the acceleration in inflation has complicated the task of the authorities. One consequence has been the rise in minimum lending rate (MLR) to 17% (in November 1979), and the high level of nominal interest rates since then.
Published on
01 March 1980
Economic commentary