The Bank of England will likely increase its benchmark interest rate in February next year, signalling the first policy tightening since 2008.
According to the National Institute for Economic and Social Research, early signs of stronger price pressures can currently be noticed in earnings growth although it expects low average inflation for 2016.
Niesr economist Jack Meaning projected inflation averaging 1.1% next year and 1.8% the following year, below the central bank’s 2% goal.
The BOE, similar to the Federal Reserve, is edging toward abandoning emergency stimulus and raising rates. Governor Mark Carney mentioned the factors weighing on price will start to drop out of consumer price computations.
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