BOE Analysis Rejects Claims of Greedflation Profiteering in UK
- Profit margins shrink for most firms since price shock began
- Estimate shows excess profits have fallen, labor share steady
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Profitability for most UK companies has fallen since prices started soaring after Russia invaded Ukraine, according to Bank of England analysis that finds little evidence to support accusations of corporate “greedflation.”
Oil and gas firms have seen margins increase but they buck the trend of declining profitability for the private sector as a whole. In aggregate, over the five quarters from the start of 2022, the share of national output captured by excess profits has declined by 3.5 percentage points, the research found.