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There definitely are supply shocks with Brexit and Covid having led to disruptions and increased prices.
But yes, there is a debate as to whether demand is strong too and we are in a period of more uncertainty than usual following the economy crashing down in 2020, then re-starting this year. That rollercoaster will have had impacts that will take a while to be realised.
Some people are doing well - those who got full pay or generous furlough with nothing to spend it on - but not everyone or even most: average UK real wages are still at or below 2008 levels. And the government spending was mainly to compensate people for not earning when they weren't able to work rather than money being pumped into the economy (some was but lots of it went to the already-wealthy so squirreled away in savings or offshore and little impact on demand). UC cuts have just happened which will definitely reduce demand.
My hunch is that demand is not that strong and the supply disruption is the bigger factor - but we will find out, maybe next year!
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frank9755
Is this actually true? In normal times I wouldn’t question it, but the govt. has borrowed a fuck tonne of money and given it away to people for free. And there’s a massive backlog of stuff to do that simply wasn’t done in 2020. And there’s a global supply crunch on.
There’s massive demand for some things and normal demand for others combined with a shrunken workforce (some Brexit stuff there I guess), suppl troubles ( some Brexit stuff there) and a massive backlog. It is demand > supply.
I agree that crushing rate rises are unlikely.