IMF has revised up growth forecasts but medium-term prospects remain poor as globalisation goes into reverse World Bank official calls for shake-up of G20 debt relief scheme The 2020s are almost halfway over and are on course to be the most difficult decade for the global economy since the 1930s. Every finance minister and central bank governor at the spring meeting of the International Monetary Fund in Washington last week knows that, even if they were not prepared to admit it publicly. The IMF likes to look on the bright side. It revised up slightly its forecast for global growth and now t ..read more

City investors trim their forecasts for rate cuts this year, after inflation falls by less than expected to 3.2% Full story: UK inflation falls to 3.2%, the lowest level since September 2021 Middle East conflict risks sharp rise in oil prices, says IMF The UK’s annual inflation rate fell in March for a second consecutive month, dropping to 3.2% – the lowest level since September 2021 – easing pressure on households amid the cost of living crisis. Figures from the Office for National Statistics (ONS) show inflation as measured by the consumer prices index continued to fall from 3.4% in Febru ..read more

Predictions for when Bank of England will start lowering cost of borrowing pushed back Analysis: Sunak hopes of pre-election rate cuts frustrated Business live – latest updates The UK’s annual inflation rate fell by less than expected last month to 3.2%, complicating the timing of a potential first Bank of England interest rate cut. Figures from the Office for National Statistics (ONS), showed inflation continued to ease in March from 3.4% in February to reach the lowest level since September 2021, as food prices rose at a slower pace than a year earlier ..read more

Shift in rate reduction predictions to autumn hits prime minister’s strategy of winning back mortgage payers UK inflation falls by less than forecast to 3.2%, cooling rate cut hopes When the Bank of England governor, Andrew Bailey, told an event in Washington on Tuesday that the UK economy was “disinflating”, it raised the hopes of mortgage payers and indebted businesses that a cut in the cost of borrowing could be on the way soon. But less than 24 hours later, the latest UK inflation data and worsening interest rate forecasts have curtailed those aspirations ..read more

In the UK, anxiety over the crisis after Iran’s missile strike on Israel drives down UK shares An escalating Middle East conflict risks leading to higher oil prices, a reversal of the recent fall in inflation and a puncturing of the optimistic mood in financial markets, the International Monetary Fund has warned. The Washington-based IMF said it was closely monitoring events in the region after Iran’s missile strike on Israel at the weekend and stressed the possibility that a war between the two countries could lead to higher interest rates ..read more

The government might be celebrating falling inflation, but higher prices for goods and services are here to stay Two years ago, a two-litre bottle of supermarket olive oil cost about £7. Step into your local branch today and that same bottle will set you back more than £16. Grab a packet of pasta, or some broccoli, and you will pay 95% and 50% more, respectively, than in 2022. If your car insurance renewal is due, that will be an extra 35%-50%. The Russian invasion of Ukraine almost 26 months ago set off a chain reaction that caused energy and food bills to jump, and ultimately sent inflation ..read more

Former US Fed boss Ben Bernanke criticises failure to admit mistakes and change course Do better: Bernanke gets strict with Bank of England The Bank of England’s recent record of forecasting inflation and the path of interest rates was undermined by out-of-date methods and a failure to communicate clearly with the public, according to a bruising independent assessment. The report by the former US Federal Reserve boss Ben Bernanke said the Bank spent much of its time attempting to justify its poor judgment rather than admitting its failures and changing course ..read more

Report by former US Federal Reserve boss reveals faulty economic model and reluctance to admit mistakes Bank forecasts undermined by out-of-date-methods, report finds The Bank of England has got markedly worse at forecasting the economy in recent years. Its economic model is faulty. Its systems are out of date. It has been reluctant to admit past mistakes. Communication with the public could be better. If Threadneedle Street thought it was going to get an easy ride when it called in the former head of the US central bank, Ben Bernanke, to conduct a review of how decisions on interest rates h ..read more

Kristalina Georgieva warns of ‘new inflation surprises’ that could result from easing of interest rates Business live – latest updates UK politics – latest updates The world’s leading central banks must resist growing pressure for early interest rate cuts amid concerns over stubbornly high inflation on both sides of the Atlantic, the head of the International Monetary Fund has urged. Kristalina Georgieva said high inflation across advanced economies was “not fully defeated” and could require a longer wait before reducing borrowing costs ..read more

Thanks to near-monopolies in many industries, corporations are seeing record profits as consumers struggle with high prices We learned this week that the Consumer Price Index climbed 3.5% in March from a year earlier, up from 3.2% in February, and faster than most economists anticipated. This poses a conundrum for central bankers who have made it clear they want to see further evidence that inflation is cooling before they cut interest rates. Robert Reich, a former US secretary of labor, is a professor of public policy at the University of California, Berkeley, and the author of Saving Capital ..read more