IoD reaction to Inflation figures

Dated: 18 January 2011

Commenting on the latest inflation figures, Graeme Leach, Chief Economist at the Institute of Directors (IoD) said:

“It would be very easy to work oneself up into a real flap over December’s inflation numbers, but it would also be a mistake. Today’s announcement does not mean there will be an early rise in interest rates. Yes, inflation is way above target and likely to get worse before it gets better. And yes, there were some record monthly increases in certain categories. But the overall story is more benign. CPIY (excluding indirect tax effects) and CPICT (at constant tax rates) are both on target at 2 per cent.

“We continue to argue that a combination of spare capacity, labour market weakness and anaemic money supply growth will begin to weaken inflation in the second half of 2011. Let’s not forget that headline inflation reached 5 per cent in the autumn of 2008, but then fell to just 1 per cent a year later.”

ENDS

Contact Points

Edwin Morgan
Media Relations Manager
Institute of Directors, 116 Pall Mall, London SW1Y 5ED
Tel: +44 (0)20 7451 3392
Mob: +44 (0)7814 386 243
Email: edwin.morgan@iod.com
Website: www.iod.com/policy

Notes to editors

  • The IoD (Institute of Directors) was founded in 1903 and obtained a Royal Charter in 1906. The IoD is a non-party political organisation with upwards of 45,000 members in the United Kingdom and overseas. Membership includes directors from right across the business spectrum – from media to manufacturing, e-business to the public and voluntary sectors. Members include CEOs of large corporations as well as entrepreneurial directors of start-up companies.
  • The IoD offers a wide range of business services which include business centre facilities (including ten UK regional centres [three in London, Reading, Birmingham, Cardiff, Manchester, Nottingham, Edinburgh and Belfast] and one each in Paris and Brussels), conferences, networking events, virtual offices and hotdesking, issues-led guides and literature, as well as free access to business information and advisory services and a comprehensive Information Centre. The IoD places great emphasis on director development and has established a certified qualification for directors – Chartered Director – as well as running specific board-level and director-level training and individual career mentoring programmes.
  • In addition, the IoD provides an effective voice to represent the interests of its members to government and key opinion-formers at the highest levels. These include ministers, constituency MPs, Select Committee members and senior civil servants. IoD policies and views are actively promoted to the national, regional and trade media.
  • For further information, visit our website: www.iod.com
  • You can also keep up to date with the latest views from the IoD on twitter.com/The_IoD and at blogs.iod.com