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		</div><p><a href="http://londonglossy.com/wp-content/uploads/2011/01/bank-chief-in-warning-over-recovery.jpg"><img class="alignnone size-full" title="Bank of England boss Mervyn King said the grim GDP figures served as a stark reminder that Britain's recovery will be choppy" src="http://londonglossy.com/wp-content/uploads/2011/01/min-bank-chief-in-warning-over-recovery.jpg" alt="Bank of England boss Mervyn King said the grim GDP figures served as a stark reminder that Britain's recovery will be choppy"/></a></p>
<p>Bank of England boss Mervyn King has said the grim GDP figures serve as a stark reminder that Britain&#8217;s recovery will be &#8220;choppy&#8221; as he braced consumers for a bleak year ahead.</p>
<p>In a speech at Newcastle&#8217;s Civic Centre, the Bank Governor warned Britons to expect inflation to rise to between 4% and 5% over the next few months.</p>
<p>Real wages will plunge back to 2005 levels as prices soar and the Government&#8217;s deficit-busting actions take effect, he added.</p>
<p>While the economy was &#8220;well placed to return to sustained, balanced growth&#8221;, Mr King outlined strong headwinds facing the economy in 2011.</p>
<p>Rising unemployment and declines in real earnings will hit spending in the private sector, with the public sector hammered by Government spending cuts.</p>
<p>But it was inflation that was the Governor&#8217;s biggest immediate headache.</p>
<p>He told the accountants&#8217; business dinner on Tuesday evening: &#8220;Today&#8217;s GDP figures remind us that, as I said last year, the recovery will be choppy.</p>
<p>&#8220;Of more immediate concern to the Monetary Policy Committee is that we are experiencing a period of uncomfortably high inflation.&#8221;</p>
<p>He added: &#8220;With the standard rate of VAT rising to 20% this month, and recent further increases in world commodity and energy prices, inflation is likely to rise to somewhere between 4% and 5% over the next few months, before falling back next year.&#8221;</p>
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