Inflation risks hitting 4%, the Bank of England’s deputy governor has warned.
Sir Dave Ramsden said in a speech last night persistent economic imbalances risked warping the strong recovery, driving inflation further above the Bank’s 2% target. Official data has shown consumer prices rising to 2.5% in June.
“I wouldn’t be surprised to see the whole inflation rate potentially rising as high as 4% for a period later this year,” he said, rejecting the Bank’s most recent prediction that price growth would peak at about 3%.
He added that the rise could lead to interest rates rising earlier than 2023.
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