Migration from new EU member states in Eastern Europe has helped limit inflation in the UK over the past year, according to comments from Bank of England governor Mervyn King.
He says migrants have filled the gaps created by increased demand for labour in the UK economy, helping keep wage inflation down, rather than has previously been the case when such demand has stoked UK prices. The Daily Telegraph quotes King stating this is one of the beneficial effects of globalisation, and a change that is leading to the concept of the ‘output gap’ – a measure used by economists to calculate spare capacity in the economy – should be ditched. King cites Home Office figures suggesting 120,000 people moved to the UK from the new EU member states in the year to March, h...
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