The unexpectedly large jump in headline consumer price inflation in January to 6.5% y/y is a clear challenge to our view that the hiking cycle is at an end. Further signs of the economy coming off the boil and a drop in household inflation expectations means we aren’t throwing in the towel just yet, but a similarly high headline inflation number in February would probably seal the deal on another rate rise in the MPC’s next meeting in April.
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