- BOE KING: CPI remains uncomfortably high
Market news
11 May 2011
BOE KING: CPI remains uncomfortably high
- Great deal of uncertainty about CPI outlook;
- Risk high inflation to push up inflation expectation;
- Risk of upward pressure on wages, prices;
- Output remains about 4% below pre-crisis peak;
- MPC sees recent growth softness temporary;
- GDP two year outlook broadly unchanged from Feb;
- MPC needs to look through monthly CPI volatility;
- No one knows how monpol needs to respond;
- MPC united in determination to get CPI to target;
- Faced with genuine puzzles in labour market trends;
- Q1 GDP showed clear sign of pickup in manufacturing, services;
- Not expecting especially strong recovery, seen modest;
- Domestic inflation pressures are well below target;
- Low domestic CPI pressures highlights MPC dilemma.
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