U.K. inflation probably eased from a three-year high in October and may slow further as Europe’s debt crisis depresses the economic outlook.
Inflation slowed to 5.1 percent from 5.2 percent in September, according to the median estimate of 33 economists in a Bloomberg News survey. Because the rate exceeds the government’s 3 percent upper limit, Bank of England Governor Mervyn King will be required to write a letter of explanation to Chancellor of the Exchequer George Osborne.
The Bank of England is in the second of a four-month program of bond purchases aimed at supporting the recovery. With the economy under pressure from the government’s budget squeeze and Europe’s sovereign debt turmoil, King will face questions at a press conference tomorrow on the central bank’s use of so- called quantitative easing to prevent another recession.
U.K. Inflation Slows More Than Forecast to 5%
U.K. inflation cooled more than economists forecast in October, led by a drop in food, transport and gasoline costs.
Inflation slowed to 5 percent from 5.2 percent in September, the Office for National Statistics said today in London. The median estimate of 33 economists in a Bloomberg News survey was 5.1 percent. As the rate exceeds the government’s 3 percent upper limit, Bank of England Governor Mervyn King must write a letter to Chancellor of the Exchequer George Osborne saying what will be done to tame price gains.
The Bank of England is in the second of a four-month program of bond purchases it started in October to support the recovery. With the economy under pressure from the government’s budget squeeze and Europe’s sovereign debt turmoil, King will face questions at a press conference tomorrow on the central bank’s use of so-called quantitative easing. He has forecast that price gains will ease “sharply” in 2012.
