For the first time since gaining independence 25 years ago, the Bank of England faces high inflation. Simultaneously a new ministerial team seems intent on loosening fiscal policy. In the last 50 years there were three significant peaks in inflation before the current rise. How do these compare with today’s circumstances and are there lessons to be learned from the past? Before the OPEC oil price shock in 1973, the UK was already experiencing domestically generated inflation. The government under Edward Heath began a series of unsuccessful voluntary and statutory incomes policies which attempted to control inflation ... (full story)