According to the UK press everyone was surprised by the March inflation number.
It was a bad one. CPI annual inflation – the Government’s target measure – was 3.5 per cent, up from 3.4 per cent in February. Meanwhile, the more accurate retail price index increased by 3.6 per cent compared to the same month last year.
Why would anyone be surprised by rising prices. The Bank of England has printed a third of a trillion in cash. At the same time, GDP is declining. Think about that for a moment, more cash and no extra output.
That must mean more money chasing fewer goods. Only one thing can happen in a situation like that. Prices go up, which is exactly what happened.
The surprising thing is that people are surprised.