Wednesday, May 11, 2011
Downgrading growth, upgrading inflation: Just another new Bank of England forecast
Posted by David Smith at 12:00 PM
Category: Thoughts and responses

"In today's Report, the recent pattern of revisions of projections over the next year - downward to growth and upward to inflation - has continued," said Mervyn King. "But looking further ahead, the horizon relevant for policy, the big picture has not changed much since February."

The big picture is that inflation will be above target through next year as well as this, and that the 1.5% growth the Bank expected over Q4 2010 and Q1 2011 together did not happen. If there was one word used more than any other it was uncertainty, although King was certain that Bank rate will have to go up at some stage.

Labour will seize on the weakness of growth as evidence that the coalition strategy is failing. More here.