UK Quantitative Easing and Inflation

The Bank of England is expected to launch the sixth round of quantitative easing this week. This is likely to take the total of its money-creation programme to a minimum of £325billion, the equivalent of more than 22% of GDP. This figure means that for every £1 in £5 that the nation earns, the Bank has conjured £1 out of thin air. 


As the old saying goes, 'for every reaction there is an equal and opposite reaction'.  Hold onto your purses, inflation is coming and it is not going to be pretty.  For those who lived through the 70's double digit inflation, the future might not look too dis-similar. 


Inflation is just another tax dressed up as something different.