The Bank of England has raised interest rates for a record-breaking 12th successive meeting, lifting the cost of borrowing to 4.5% and warning that inflation would be higher this year than it previously anticipated.
The bank’s Monetary Policy Committee said that there would be no recession this year, upgrading its economic growth forecasts by more than in any of its previous reports.
It is a dramatic change from only a few months ago, when it was predicting the longest-lived recession in modern British history. However, it still only results in relatively lacklustre economic growth this year and next.
While it signalled that interest rates may now be at their peak, the bank also said that it had been surprised by the rate at which food prices are rising, and that meant that wider inflation – the speed at which prices are rising each year – would be stickier this year and next.
The bank is now forecasting that inflation will be around 5% at the end of this year, rather than the 4% level it previously forecast.
That means the prime minister may come within a whisker of missing his target of halving inflation this year – though the bank’s forecasts imply he will narrowly squeak what previously looked like a somewhat unambitious target.
With interest rates now at the highest level since 2008, an increasing number of households are feeling the impact of rising borrowing costs, but the bank says only a third of the pain from higher mortgage payments had yet trickled into the economy.
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The vote to change interest rates was split, with seven members voting for the quarter percentage point increase but two MPC members, Silvana Tenreyro and Swati Dhingra, voting to leave them unchanged.
The new MPC forecasts suggest the economy will grow by around a quarter percentage point this year, compared with a previous forecast of a half percentage point contraction.
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That will be followed in 2024 by a three-quarter point increase in gross domestic product, compared with previous forecasts for a quarter percentage point fall.
A woman casually walks into a convenience store and starts filling a bread crate with goods from one of the aisles.
A shop assistant tries to stop her, but she shrugs him off, undeterred. With the crate now full of items, she leaves without paying.
It is a scenario that is played out day in and day out across Britain, as retailers warn the surge in shoplifting is now “out of control”.
I’m sitting in the security office of a busy city centre shop and I’m watching as a schoolboy walks in and helps himself to a sandwich, stuffing it into his jacket.
Watching with me is shop worker Anton Mavroianu who positions himself by the main entrance waiting for the youngster to leave.
When the boy does leave, Anton demands the item back. Instead of being frozen with fear that he’s been caught, the boy laughs and walks off.
“All we can do is try to stop them,” Anton tells me. “But this is just another day for us.”
A few weeks earlier, when Anton tried to stop a shoplifter who had stolen from the store, the man pulled out a knife and tried to attack him.
This terrifying incident is an example of the very real threat posed to shop workers as they try to stem the tide of brazen thefts.
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Shoplifting offences recorded by police in England and Wales have risen to the highest level in 20 years.
The British Retail Consortium (BRC) also reports that theft-related losses cost the retail sector millions each year, adding strain to an industry already grappling with post-pandemic recovery and economic uncertainty.
For small businesses, which lack the resources of larger chains, persistent theft can threaten their very survival.
Ricky Dougall owns a chain of convenience stores and says shoplifting cost his business around £100,000 last year.
“Shoplifting is a huge problem and it is what stops us from growing the business.
“People come in and help themselves like they own the place and when you call the police, most of the time, they don’t turn up.”
Mr Dougall says part of the problem is how this type of crime is classified.
Sentencing guidelines for thefts of under £200, so-called “low level shoplifting”, were relaxed in 2016. That is being blamed for the surge in cases.
An exclusive Sky News and Association of Convenience Stores survey shows that 80% of shopkeepers surveyed had an incident of retail crime in the past week.
The poll also found 94% of shopkeepers say that in their experience, shoplifting has got worse over the last year, with 83% not confident that the police will take action against the perpetrators of retail crime on their premises.
Paul Cheema from the Association of Convenience Stores says retailers are looking to Government to support them.
“I would say officials do not give a s*** about us retailers,” he tells me. “The losses are too big and I don’t think we can sustain that anymore.
“I would urge Keir Starmer to come and meet us and see up close the challenges that we are facing.”
Retailers have responded by investing heavily in security measures, from advanced surveillance systems to hiring more security staff.
But these investments come at a cost, often passed down to consumers through higher prices.
I get chatting to Matt Roberts, head of retail in the store I am in. He worries about shoplifting, but he worries about the staff more.
“I would imagine they dread coming to work because they’re always on tenterhooks wondering whether something is going to happen today, whether they are going to have to try and confront someone.
“It’s a horrible feeling. It’s out of control and we need help.”
The government has acknowledged the urgency of the issue. Home Secretary-led discussions with retail associations and law enforcement are underway to craft a comprehensive strategy.
In the King’s Speech, the government outlined details of a Crime and Policing Bill, which promised to “introduce stronger measures to tackle low level shoplifting”, as well as introducing a separate offence for assaulting a shop worker.
Children do not feel safe, a charity has warned, as a survey finds two-thirds of teens in England and Wales have a fear of violence.
The charity, which surveyed 10,000 children aged 13-17, found that 20% of teenagers have been victims of violence in the past 12 months.
“I think what shocked me most is how this is a problem that affects all of our children,” said Jon Yates, CEO of the Youth Endowment Fund.
“We found that two-thirds of all teenage children are afraid. And that fear is pretty real for a lot of them.”
He said it’s a fear so palpable that many teenage children are changing their patterns of behaviour, or have had it influence their daily decisions.
One third of teenage children – 33% – reported avoiding areas, whilst around 27% alter their travel routes or avoid public transport altogether to stay safe.
More worryingly, however, some say the fear of violence has led to mental health challenges, with 22% reporting difficulties sleeping, reduced appetite and concentrating in school.
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Weapon carrying is also a concern for the charity, especially among vulnerable groups.
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From September: Young gangs of Wolverhampton
In England and Wales, 5% of all 13-17 year olds reported carrying a weapon in the past year, but that figure jumps to 21% for those suspended from school and 36% for children who have been excluded from school.
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But Mr Yates said “shockingly” only 12% of children who repeatedly commit violence get any sort of support.
“That’s madness,” he said.
Jay*, 23, from Birmingham said depending on your environment, sometimes violence is hard to avoid.
“I’ve had friends be shot, I’ve got friends who have been stabbed, I had a friend die last month to be fair,” Jay told Sky News.
He said it is “damaging” because you never really get the opportunity to “heal”. He is now being supported by the charity Project Lifeline, but says before then it was difficult to find any hope.
“If you don’t have hope,” Jay added, “you can’t really get anywhere. It’s about finding that hope.”
Mark Rodney, CEO of Lifeline Project, mentors at-risk young children and said he has learned that “not only the perpetrator carries the knife, the victim sometimes carries the knife”.
“And not only the perpetrator does the killing,” he added. “The victim sometimes does the killing, because that’s where we’re at.”
He said far too many families ask themselves “is my child safe going to school or coming home from school?” and adds the government must “actually start addressing people’s concerns”.
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From September: Home Sec vows to halve knife crime
The report also found that in 93% of cases where teenage children repeatedly harm others, adults intervene with punishments such as school discipline or police involvement.
However, only 12% of these children are offered support aimed at addressing the root causes of violence and preventing further harm.
Mr Yates said: “They go to school, they do something violent. They get excluded.”
He added: “We need to be much better at saying, ‘we’re not going to lose that child. We’re going to keep providing support to them. We’re going to keep providing a mentor’.
“Instead, we let them fall through the cracks”.
A government spokesperson said: “Halving knife crime in a decade is a clear mission this government has set out.
“It is vital to protect vulnerable young people who are too often the victims or perpetrators of this crime.”