§ 21. Mr. Winnickasked the Chancellor of the Exchequer if he will estimate the level of inflation within the next six months.
§ Sir Geoffrey HoweForecasts of movements in the retail prices index will be published next week in the FSBR. I do not intend to anticipate these.
§ 34. Miss Joan Lestorasked the Chancellor of the Exchequer what plans he has to reduce the current rate of inflation; and if he will make a statement.
§ Sir Geoffrey HoweInflation can be lowered on a lasting basis only by sticking to our policy of reducing the rate of growth of the money supply, supported by a firm fiscal policy. The reduction in inflation will come slowly and be less likely to involve rising unemployment and high interest rates, when inflationary expectations are reduced and when labour markets respond to the imperatives of monetary policy. There are now some signs that some wage bargainers are taking an increasingly realistic view of the financial circumstances facing their organisations, and the economy generally, and are modifying pay settlements accordingly.