There is Now Increased Risk of Persistent Inflation – Guido Fawkes

Bank of England Chief Economist: There is Now Increased Risk of Persistent Inflation

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The Bank of England’s chief economist Huw Pill has today warned that inflation is now at a higher risk of remaining persistent. The Bank of England growing increasingly cautious on another rate cut…

In yesterday’s monetary policy briefing the BoE said inflationary risks are up since May. Pill said in a briefing just now that “there is some shift in the balance of risks on inflation… At the margin, there has been an upward shift in inflation risks for 2-3 years’ time. There is a risk of spillover into more persistent inflation.” Unemployment is acting as an “offsetting factor”…

The BoE has said that inflation is set to peak at 4% at September after rising to 3.5% in the second quarter of the year. Andrew Bailey yesterday said domestic effects such as vehicle excise duty and additional taxes were pushing up inflation. Reeves will not be enthused by high inflation covering pretty much the length of the parliament…