BOE's Bailey Says U.K. Growth Expected to 'Slow Sharply'

The video discusses the rise in inflation due to higher household energy prices and the delayed impact of wholesale price changes on retail prices. It highlights the expected slowdown in UK GDP growth and the significant contraction in real household disposable income. The video projects that inflation will peak later in the UK compared to other economies and will eventually fall below the target. However, risks remain due to potential persistent wage growth and domestic price setting.

What is the primary reason for the delay in the reflection of wholesale gas and electricity prices in retail energy prices in the UK?

• International trade agreements

• Price cap mechanism

• Government subsidies

• Consumer demand

What is the expected impact on UK GDP growth in the first half of the forecast period?

• Moderate increase

• Rapid growth

• Sharp slowdown

• Stagnation

Which factor is primarily responsible for the projected contraction in real household disposable income in 2022?

• Increase in global energy prices

• Decrease in employment rates

• Rise in interest rates

• Reduction in government spending

Once CPI inflation starts to fall, how quickly is it expected to decline?

• Very slowly

• Relatively quickly

• At a constant rate

• Not at all

What is a potential risk to the inflation projection mentioned in the transcript?

• Persistent strength in nominal wage growth

• Decrease in global trade

• Reduction in consumer spending

• Increase in foreign investments