England Captain Harry Kane had a hard choice to make in the 50th minute of the team's 7-0 thrashing of North Macedonia at Old Trafford: Pass to Trent Alexander-Arnold, a man known to deliver the right pass at the right time, or to Bukayo Saka, the boy wonder himself. Ultimately, the skipper made the right choice - laying it off to Saka for his first ever career hat-trick. The 21 year-old was in raptures. Three goals in quick succession, all in that pristine white shirt, with the Three Lions emblazoned on them. A day to be proud of for the youngster. However, about 200 miles from the Theatre of Dreams, there were officials wearing their own white shirts, albeit collared, and seemingly lacking the feline touch.
They, like Kane, had a hard choice to make. Unfortunately, they don't have the clinical finishing of Bukayo Saka to rely on. However, they do have their usual warhammer: Monetary policy. This consists of two things: Passing and Shooting. Yes, you read that right. Passing means raising or lowering the interest rate, to make it either harder or easier for people to borrow/spend money. Shooting, means directly controlling the money supply. This can be through quantitative easing, which is essentially buying bonds to push up interest rates, or buy limiting the money that goes out. Both of these things can increase/decrease average price level, having an effect on inflation.
The football references keep coming, so just like the #7 curse at the Three Lions playing field, the country will post a headline inflation rate of around 7%. Headline inflation is the change in the consumer price index (CPI), so essentially the average prices for items, between the current month and the same month the year prior. Basically, the price index increased 7% from June of last year to this year. The more it costs to buy things usually reflects on the amount of money people have to spend, causing companies to make more items. When we make it harder to spend money, we can reduce the inflation rate, but what we end up increasing is the unemployment rate. The less people have to spend, the less reason companies have to make their products, so they end up laying-off their workers. Just like if Saka started going on a horrible run of form, Kane would consider passing to a different option, or simply go for the shot himself.
The central bank has a tough decision to make. Do they pass, or shoot? Or, in this case, maybe both?
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