It is generally determined by Ofgem’s cap on the price that energy suppliers can charge consumers. In turn, Ofgem bases its calculation of the cap on the wholesale prices energy suppliers are expected to pay in European energy markets. Since October, the cap has itself been capped by the Government’s Energy Price Guarantee (shown in orange). Page 6  Chart 2b: Typical household energy bill Smaller of Ofgem energy price cap and Energy Price Guarantee  You can see that the typical energy price bill went up in a few big strides as Russia’s assault on Ukraine drove up wholesale energy prices. In October, as the Energy Price Guarantee was put in place to moderate what would have been an even higher increase in Ofgem’s price cap, the typical energy price bill was nearly twice as high as a year earlier. As shown in the right-hand chart, annual inflation in the typical household bill was nearly 100%. Even if electricity and gas only accounted for about 3½ per cent of the consumer price index, this increase had a big impact on the overall inflation rate: a 100% price increase in 3½ per cent of the consumption basket adds 3½ percentage points to inflation. Page 7  Chart 2c: Typical household energy bill Smaller of Ofgem energy price cap and Energy Price Guarantee  Looking ahead, with the announced adjustment to the Energy Price Guarantee, the typical energy price bill is set to rise further to £ in April.
If a particular security is scarce in the market, we will presumably not be shown offers at attractive terms, and hence we will not end up removing additional supply of that security. 9  The Desk tends to avoid conducting operations on days that coincide with FOMC announcements and on days that are known to have lighter liquidity conditions. 10  The Desk has begun publishing additional information from its operations, including information about the prices paid for each security, on a monthly basis. In addition, under the Dodd–Frank Wall Street Reform and Consumer Protection Act, the Federal Reserve will publish additional information about its open market operations, including the individual securities purchased, the transaction prices and the counterparty, with a two-year lag for all transactions subsequent to the legislation. 11  Implementing the program over an eight-month period would not be expected to significantly reduce the speed or magnitude of its effects on financial conditions and, ultimately, on the real economy under the view that the program’s effects arise from the expected stock of our holdings rather than the flow of our purchases. Under this view, financial conditions react immediately to the announcement of the program, bringing forward its effects on financial conditions. This view provides policymakers with some flexibility regarding the amount of time to implement the total amount of purchases. BIS central bankers’ speeches  3  The flexibility of this procedure can be seen in the patterns of our purchases over time.