Price inflation has continued to abate throughout much of the year, with the retail price index rising recently by barely ½% a month. Weak demand and the appreciation of sterling have contributed to this outcome. For companies, the result has been a compression of profit margins, and in real terms profitability in the first half of this year was the lowest ever recorded. In contrast, the real earnings of those in work have risen.
Published on
01 December 1980
Economic commentary