There is a question that British economic policy makers keep asking: How on Earth does Japan manage to keep inflation so low when much higher rates are affecting so many countries — including the U.K., which has been hit particularly hard?
How does Japan, which imports massive volumes of oil and gas at ever rocketing prices, and with a weakening currency as well, still keep inflation at around 2.3%?
In the U.K. inflation is now running at 9.4%, with more increases to come. This puts it well above the danger level and means that the entire culture is poised to turn inflationary. This also spells wage and salary demands being pushed ahead with real anger and desperation, as workers see their incomes shrinking before their eyes. It is a pattern that appears unstoppable, and will leave lower income households unable to pay for basic needs, such as heating, cooking, lighting and electricity. Public sector workers are especially incensed when they are offered a 5% wage increase against a 10% to 12% inflation forecast.