Gas and electricity price hikes have sent inflation soaring to a 16-year high in Britain. But policymakers believe recession is a greater worry than inflation, reports The Times. Sounds like Singapore?
But there are differences:
While the Monetary Authority of Singapore decided to stop bolstering the Singapore dollar, giving up the fight against inflation, the Bank of England cut interest rates by half a percentage point to boost battered markets.
Inflation in Britain, at 5.2 percent, is still lower than in Singapore, which is officially estimated to experience 6 to 7 percent inflation this year.
And inflation will hurt the poor less in Britain. The government will be paying billions more in benefits and pensions as the headline Retail Prices Index (RPI) reached 5 per cent, its highest level since July 1991, report the Telegraph and the Guardian.
While inflation is measured by the Consumer Price Index, the Retail Price Index is used in Britain to calculate pensions and benefits and in wage negotiations. Wikipedia tries to explain how the two different indices came about.
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