		<div class="wpcnt">
			<div class="wpa">
				<span class="wpa-about">Advertisements</span>
				<div class="u top_amp">
							<amp-ad width="300" height="265"
		 type="pubmine"
		 data-siteid="111265417"
		 data-section="2">
		</amp-ad>
				</div>
			</div>
		</div><p><a href="http://londonglossy.com/wp-content/uploads/2011/02/further-inflation-leap-expected.jpg"><img class="alignnone size-full" title="Pressure is set to mount on the Bank of England on Tuesday as inflation is expected to surge" src="http://londonglossy.com/wp-content/uploads/2011/02/min-further-inflation-leap-expected.jpg" alt="Pressure is set to mount on the Bank of England on Tuesday as inflation is expected to surge"/></a></p>
<p>Pressure is set to mount on the Bank of England on Tuesday as inflation is expected to surge and trigger another letter of explanation from Governor Mervyn King.</p>
<p>After jumping to 3.7% in December, analysts expect inflation figures to show a rate of 4.1% for January, as the VAT hike from 17.5% to 20% on January 4 and soaring commodity costs pushed up the cost of living.</p>
<p>A further surge is likely to pile pressure on Mr King and his fellow policymakers at the Bank&#8217;s Monetary Policy Committee (MPC) to consider lifting interest rates from historic lows of 0.5%.</p>
<p>Furthermore, the Governor is required to write to Chancellor George Osborne when inflation has been 1% or higher above the Government&#8217;s 2% target for three months in a row. He is given 24 hours notice of the data, and will be penning his message.</p>
<p>Last month&#8217;s unexpectedly large increase in inflation sparked calls for a interest rate hike, and just as the more hawkish MPC members were looking close to getting their way, figures revealed the economy went into shock decline in the final three months of 2010 by 0.5%.</p>
<p>The figures highlighted the fragile position the economy has found itself in &#8211; teetering close to a period of so-called stagflation, when sluggish growth and high unemployment combine with soaring prices.</p>
<p>Possibly considering the weaker than expected fourth quarter GDP figures, the MPC held its nerve and kept rates at their 0.5% historic low last week for a 23rd consecutive month.</p>
<p>But the Bank believes inflation has been driven higher by temporary price shocks &#8211; such as the weak pound and high energy costs, which should pull back.</p>
<p>Howard Archer, chief UK and European economist at IHS Global Insight, said while he expects inflation to continue to rise in the short term, it will drop back to 2% in early 2012.</p>
<p>He said: &#8220;Consumer price inflation will hopefully start heading down in the second half of the year and dip below 3% before the end of 2011 as the upward impact from VAT developments, higher energy, commodity and food prices, and sterling&#8217;s past sharp depreciation wanes.&#8221;</p>
			<div style="padding-bottom:15px;" class="wordads-tag" data-slot-type="belowpost">
				<div id="atatags-dynamic-belowpost-69e1858bcb7ba">
					<script type="text/javascript">
						window.getAdSnippetCallback = function () {
							if ( false === ( window.isWatlV1 ?? false ) ) {
								// Use Aditude scripts.
								window.tudeMappings = window.tudeMappings || [];
								window.tudeMappings.push( {
									divId: 'atatags-dynamic-belowpost-69e1858bcb7ba',
									format: 'belowpost',
								} );
							}
						}

						if ( document.readyState === 'loading' ) {
							document.addEventListener( 'DOMContentLoaded', window.getAdSnippetCallback );
						} else {
							window.getAdSnippetCallback();
						}
					</script>
				</div>
			</div>
Discover more from London Glossy Post
Subscribe to get the latest posts sent to your email.
