Yael Selfin, Chief Economist at KPMG UK, comments on weak inflation pressure on Bank of England.
“Weak inflation takes the pressure off the Bank of England to raise rates but don’t expect cuts any time soon”, says Yael Selfin, Chief Economist at KPMG UK:
“Despite the moderating pace of inflation, thanks partly to a late Easter, the Bank of England is unlikely to follow the change of heart of other major central banks. The MPC is expected to keep its sights on the next, albeit delayed, interest rates rise, rather than contemplate an easing at this stage.
”Assuming no major Brexit-related disruptions or other external shocks, we expect CPI inflation to remain slightly below the MPC target of 2% over the medium term, leaving scope for the MPC to keep rates unchanged until late next year.”