BOE Warns UK Inflation Could Drop Below 1%

The Bank of England has warned that inflation could fall below 1% in the next six months, owing to lower food, energy and import prices, as well as feeble growth in Europe and elsewhere.

Governor Mark Carney said he did not expect inflation to reach the targeted rate of 2% for three years.

The Bank also cut its prediction for UK economic growth in 2015 to 2.9%.

However, the Bank said it expected average salaries to be growing by 2% by the end of 2015.

Earlier, official figures showed average wages excluding bonuses grew by 1.3%, which was just above the latest rate of Consumer Prices Index inflation and the first time it has risen above that measure in five years.

The Office for National Statistics figures also showed that unemployment in the UK fell by 115,000 in the three months to the end of September, to a total of 1.96 million.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza