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NIESR: Head of UK macroeconomic forecasting reacts to the latest ONS CPI inflation data

NIESR’s Head of UK macroeconomic forecasting, Amit Kara has commented on the latest ONS CPI inflation data.

NIESR’s Head of UK macroeconomic forecasting, Amit Kara said: “CPI inflation was 3.1 per cent over the 12 month period to November. This is the highest reading since March 2012. Inflation is now more than 1 percentage point away from the 2 per cent inflation target, automatically triggering an explanatory letter from the Governor to the Chancellor. We understand however that this letter will not be published until the next Inflation Report in February”.

He added: “We expect inflation to peak at current levels in the final quarter of this year before dropping back to the target rate by mid-2019.  The Bank will in our view raise the policy rate every six months until the policy rate reaches 2% by mid-2021, with the next increase in May. Wage growth is likely to remain under pressure as a result”. 

Notes for editors:

For further information and to arrange interviews, please contact the NIESR Press Office:
Paola Buonadonna on 020 7654 1923 / p.buonadonna@niesr.ac.uk   

NIESR aims to promote, through quantitative and qualitative research, a deeper understanding of the interaction of economic and social forces that affect people's lives, and the ways in which policies can improve them.

Further details of NIESR’s activities can be seen on http://www.niesr.ac.uk or by contacting enquiries@niesr.ac.uk . Switchboard Telephone Number: +44 (0) 207 222 7665

 

Original article link: https://www.niesr.ac.uk/media/niesr-press-note-%E2%80%93-head-uk-macroeconomic-forecasting-reacts-latest-ons-cpi-inflation-data

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