During the past two weeks we have covered the cause of inflation and what that might mean for its future. For now, though, we have it. So who are the winners and losers?
Naturally all those with savings are having a very tough time. With interest rates in savings accounts at around 1% and inflation forecasted to hit 8%, the real value of their money is falling at 7% per year. If those savers are taking an income or withdrawing from it, this is damaging their wealth at a rate they may not be able to recover from.
Savings rates are in no hurry upwards. Unfortunately, those with low savings tend to need access to it with no risk, and with a very low attitude to risk, it’s hard to see where they can invest their money, given the higher values attributed to bonds and of course property at the moment.
