Posts Tagged ‘Central bank’
Inflation Failed Cheer Sterling
Sterling fell after the rise in UK inflation failed to reassure investors that the Bank of England will reduce asset purchase program. Annual consumer price index rose to a record 5.2%, higher than forecast 4.9% and 4.5% the previous publications.
“In the short term, inflation would still increase; but we also know in the long run the Bank of England believes that there is the threat of deflation,” said Simon Derrick, strategic Bank of New York Mellon. “The idea of sterling would be fostered by the monetary policy outlook post-spike in inflation is too excessive. The central bank will continue to maintain loose monetary policy in the near future and this would have a negative for sterling.”