The third quarter of the year continued the motif of significant change in the UK, with the sad passing of Queen Elizabeth II, and the ascendance of the Prince of Wales to the title of King Charles III. The Queen died just two days after meeting with the new Prime Minister, Liz Truss, and asking her to form a government.
Politically and economically, Q3 has also seen the continuation of the conflict in Ukraine and the development of further and deeper understanding of its direct and indirect effects particularly across Europe and also through the UK.
In addition, the major needle-mover has of course been the resignation and replacement of the Prime Minister, resulting in a new Cabinet having been appointed, and new policies being explained to parliament and beginning to be implemented.
In the broad economy, effects of energy price explosion have been seen in sustained consumer price inflation, currently standing at over 10% per annum and forecast to increase even further, the raising of the interest rate to 2.25% and the presaging of new government borrowing of £130bn to protect households and businesses against enormous hikes in energy bills.
In the background, sanctions on Russia continue, and both Europe and the UK have to look ahead to what winter may hold, given the prospect of a closing of the gas valve from Russia.
For these reasons, RLB has chosen to express forecasts of tender price inflation for upcoming periods in groupings of Lower, Most Likely and Upper percentages. The intent is to provide-for a range of possible outcomes in this very uncertain environment, with an indication of the currently perceived most likely outcome.