Inflationary pressure in the UK could continue to rise in 2022 – BoE’s Haldane | Invest News
LONDON (Reuters) – Bank of England chief economist Andy Haldane has said the central bank’s new forecast that inflation will exceed 3% may prove too low and the pressure on prices could accelerate not only this year but also in 2022.
Haldane, who voted on his own to cut the BoE’s bond buying program at its last monetary policy meeting this week, told MoneyWeek magazine he disagreed with his colleagues on when inflation would start to slow.
“I think it could last a little longer and (…) we could therefore find ourselves exceeding our inflation target of 2% for a period a little longer than what we are currently anticipating”, he declared.
Consumer price inflation in Britain hit 2.1% in May, adding to concerns about a global inflation pickup that could force central banks to cancel their emergency coronavirus stimulus programs earlier than expected.
The BoE said on Thursday its policymakers now expected UK inflation to spike above 3%, down from a previous estimate of 2.5%, but most of them believed the acceleration would be temporary and that their revival was necessary for the moment.
Haldane, who is leaving the BoE later this month, told MoneyWeek in a podcast interview that in addition to a wide range of input costs for businesses, wages were also on the rise.
“Next year the price pressures may not abate,” he said.
(Written by William Schomberg. Editing by Andrew MacAskill)
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