Inflation slows to lowest in three years

19th September 2019.

UK inflation fell to its lowest point in three years in August, the Office for National Statistics has said, after prices rose by an annualised rate of 1.7% – well below the Bank of England’s 2% target.

“Games, in particular computer games, accounted for 0.15 percentage points of the fall,” said Andrew Wishart, UK economist at Capital Economics.

Cheaper clothes, toys and petrol also helped to pull inflation down to its weakest annual pace since December 2016.

This marks a boost for household spending as last week the ONS also reported that wage growth last month was at its highest rate since mid-2008. Nevertheless, IoD’s chief economist Tej Parikh argued that “upward price pressures are in the pipeline,” as “domestic and international factors are conspiring to push UK prices up in the near future”.

Jing Teow, an economist at PwC, said that the combination of cooling prices and rising wages “delivers a substantial boost to UK households’ spending power that will help to support the economy”.

Ian Stewart, chief economist at Deloitte, offered: “Sharply lower inflation is great news for the UK economy. Along with soaring earnings, low inflation boosts consumer spending power just when the economy needs it.”

Yael Selfin, chief economist at KPMG, commented: “The falling inflation rate could be an early signal of a cooling economy, in line with what we have seen in the US and the euro area.”

House Price growth slows in July

Annual UK house price growth in July slowed to its worst rate since September 2012, according to data from the Office for National Statistics.

UK house prices grew just 0.7% in the year to July, taking the average to £232,710.

Almost half of all UK regions suffered a decline, with the North East seeing the sharpest fall at 2.9%.

PwC economist Jamie Durham commented: “Among other factors, the capital and surrounding areas are particularly affected by Brexit uncertainty, and price growth is likely to remain weak or negative until this uncertainty subsides.”

Separately, the Royal Institution of Chartered Surveyors reported that new buyer enquiries improved slightly in July, but not enough to boost demand.

British interest rates

For the 14th month running the Bank of England’s monetary policymakers left interest rates unchanged today, at 0.75%. But within weeks they may face a dilemma.

It seems the bank is keeping its power dry ahead of a potential no deal Brexit in October.

If Britain leaves the European Union without a deal—as it may on October 31st—the bank will face another dilemma – should it raise rates or cut them?

A no-deal Brexit might hurt demand by making consumers nervous, by raising unemployment and by prompting firms to postpone investment. Lower rates might therefore be necessary to encourage spending.

On the other hand, if the pound collapses, which seems likely, inflation will rise.

A chaotic withdrawal might also encourage the British (or leave them with no alternative but) to buy british made goods, especially if European imports suffer delays at ports.

If British suppliers cannot meet demand, that too would be inflationary. Higher rates might necessary to strengthen the pound and combat inflation.

Mark Carney, the bank’s governor, slightly favours easing policy if there is no deal. Either way,at historically low scope for radical action is limited.

Meanwhile in the US the FED cuts interest rates

In a move that will have implications for the global economy, the US central bank has cut interest rates for the second time this year by 0.25% as a result of concerns about slowing economic growth, a fall in US manufacturing and global trade tensions.

The move has reduced the Federal Reserve’s benchmark rate to a range of 1.75% to 2%.

The cut was approved on a 7-3 vote. President Donald Trump, despoerate to boost the US economy (which his trade wars is inhibiting) ahead of next years elections,  criticised the reduction, tweeting “Jay Powell and the Federal Reserve Fail Again. No “guts”, no sense, no vision! A terrible communicator!” Trump has been an active critic of the central bank’s chair for not going far enough with rate cuts.

Powell commented in the press conference following the decision that it represented a “mid-cycle adjustment” and that the bank was prepared to be “more aggressive” with cutting the cost of borrowing if the country’s growth slowed down enough to justify it.

 

OECD blames trade war for poor global growth

The Organisation for Economic Co-operation and Development (OECD) has urged a “collective effort” to halt the global trade war, as it cut growth prospects for almost all the world’s major economies for this year and next.

The global outlook for 2020 is now 0.4 percentage points below its estimates four months ago, while in the UK, where the prospect of a no-deal Brexit remains a “serious downside risk”, the OECD cut growth estimates from 1.2% to 1% this year and to just 0.9% in 2020.

Do you sell on credit?

With pressures on the cash flow it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.

Those customers will look for the easiest option  to boost their cash-flow. Don’t let it be you.

You can’t just assume your customers can and will pay you eventually, no matter how big their name is.

It is essential to have credit management systems in place to monitor and check your customers credit worthiness.

It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.

About CPA

The Credit Protection Association can help!

Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.

At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.

We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.

Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.

If you supply on credit, help us help you identify the risks.

Why use a third party collector?

As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When you customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.

Over the years we have collected billions in overdue invoices for our customers.

Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

CPA is passionate about late payment

The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.

We are extremely passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.

If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.

As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.

Under little used legislation, you are entitled to compensation for those late payments.

Now you can boost your own cash-flow.

CPA can help unearth the those hidden treasures.

We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.

Yes, CPA can help you boost your business cash-flow.

Don’t let your bankers control you, contact CPA today.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

The “Why” of the late payment culture.

New PM should walk the walk and back small firms over late payments

Paying late is “crack cocaine” to big business.

Late payment culture risks “spiraling out of control”

visit our late payment compensation page

See our full blog and FAQ on late payment compensation

Do you realise you could be sitting on a fortune?

Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.

If you sold B2B on credit then there may be a hidden source of capital you can call on.

If you fancy an bit of extra cash in your business, rather than jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.

Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.

We can help you uncover the pile of gold, you didn’t even know you were sitting on.

If you trade with other businesses and were often paid late then you could be entitled to significant compensation.

Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.

Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.

You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.

That compensation could provide the cash boost your business needed.

But don’t delay, that compensation evaporates if not claimed within six years of the late payment.

How can CPA help?

CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.

We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.

Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.

CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.

The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit.  You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.

We do the work, you receive the cash.

If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.

We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.

We are helping business owners  who are looking to boost the returns from their business before they retire. We are helping businesses who have lost major clients after years of loyal service to get properly compensated for systematic late payment. We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.

Those former clients who regularly paid you late can finally be made to pay.

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

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