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HomeEconomyCiti forecasts UK inflation to hit 18% by early 2023

Citi forecasts UK inflation to hit 18% by early 2023

William Schomberg

LONDON (Reuters) – UK consumer price inflation to peak at 18% – Bank of England Inflation at nine times the rate of US Citibank said on Monday that the target – earlier 2023, raised his forecast again in light of the latest rise in energy prices.

“The question now is what policy can do to offset the impact on inflation and the real economy,” Benjamin Nabarro said in a note to clients.

Consumer price inflation higher than

% in 1976.

Leading the way for the next prime minister of the UK Author Liz Truss is likely to propose measures to support households with a limited offsetting impact on headline inflation, Nabarro said. In August’s forecast percentage, its Monetary Policy Committee may conclude that more persistent risks to inflation have intensified, the note said.

“This means that rates will soon be in restrictive territory,” Nabarro said.

“If there are more signs of embedded inflation, we think a 6-7% bank rate will be needed to rein in inflation dynamics. But for now, we still see evidence of this effect as being driven by unemployment Rising limits, the MPC is more likely to pause at the beginning of the year,” he added.

The Bank of England announced a rare half-percentage-point hike earlier this month, with investors expecting the Monetary Policy Committee to issue its next appointment in September Another major move was made when the monetary policy announcement was made.

Nabarro said he expects the UK’s retail price index – used to determine returns on inflation-linked bonds – to be above 20% Peak.

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