The Monetary Policy Committee (MPC) is getting increasingly nervous about the current rise in inflation, as evidenced by Andrew Sentance’s vote for an interest rate rise last month. However, most members still seem prepared to wait and see if the spare capacity in the economy starts to pull inflation back down. We doubt that a rate hike is imminent and in fact think that the magnitude of the fiscal squeeze makes a further extension of quantitative easing (QE) likely.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services