Inflation hit 6.7% in August, down from 6.8% in July, and significantly lower than the 7.1% that had been expected.
The Bank of England is still likely to hike interest rates on Thursday, but this week’s lower-than-expected inflation figures give decision-makers a little more leeway than they otherwise would have had, economists said.
But experts at Investec Economics said that while headline and services inflation had both fallen below the August forecasts, growth in private sector pay had overshot the Bank’s outlook significantly. They added: “We do not on balance think today’s softer numbers will change tomorrow’s decision – we continue to expect a 25 basis point hike to 5.5% as our baseline case – but the risks around this have changed and more clearly it calls into question the November rate decision.”
The increases have been an attempt to stem inflation, and the Bank’s Sarah Breeden, who is expected to join the MPC before November’s meeting, said this week she thought inflation could have been double the rate it reached without the Bank’s intervention.But a rise on Thursday is far from certain. James Smith, a developed markets economist at Dutch bank ING, called the decision a “close call”.
Österreich Neuesten Nachrichten, Österreich Schlagzeilen
Similar News:Sie können auch ähnliche Nachrichten wie diese lesen, die wir aus anderen Nachrichtenquellen gesammelt haben.
Bank of England still tipped to raise rates despite surprise dip in inflationInflation hit 6.7 in August, down from 6.8 in July, and significantly lower than the 7.1 that had been expected.
Weiterlesen »
Bank of England still tipped to raise rates despite surprise dip in inflationInflation hit 6.7 in August, down from 6.8 in July, and significantly lower than the 7.1 that had been expected.
Weiterlesen »
Why falling inflation could discourage the Bank of England from hiking interest ratesWhile markets still expect the central bank to raise its base rate to 5.5 per cent, this gives it an excuse not to
Weiterlesen »
Bank of England interest rate vote on a knife edge after shock inflation fall, economists sayThe base rate currently sit at 5.25 per cent and most experts expected it to rise further before today's inflation figure was released
Weiterlesen »