ECONOMIC SPIRAL

Evening Post, Volume CXXX, Issue 108, 2 November 1940, Page 10

ECONOMIC SPIRAL

FREIGHT RATES UP

COST OF LIVING INCREASE

(Received November 2, 11.45 a.m.)

LONDON, November 1

The Ministry of Shipping has announced that homeward freight rates will be increased by 15 per cent, on December 1 next, the whole increase going to the Government, due to longer voyages and to slightly higher insurance and fuel charges.

Wholesale prices in the United Kingdom reached a new high level during October.

Food has increased by 46.7 per cent, since the outbreak of the war. Materials have increased by 37.2 per cent.

The spiral of rising prices and rising costs has received a fresh twist, first, by the announcement of a 6 per cent, rise in railway charges, then 13 per cent, increase in steel prices, and now 15' per cent, rise in homeward shipping rates, and finally, there is a further jump in the indices for wholesale prices.

Opinion in the City is to the effect that there are bound to be other rises in prices, ever increasing.

Official intervention, it would appear, still leaves the country far from being "a closed economy." It is, however, impossible to completely control the price system, but it is considered that there should be a stonewalling policy, resisting every increase which cannot fully justify itself. This policy, if persistently pursued, would have the effect of harnessing inflation.