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Inflation will fall markedly by the end of the year, Andrew Bailey has said, as he signaled interest rate rises are nearing their peak.
Article originally published by The Telegraph. Hargreaves Lansdown is not responsible for its content or accuracy and may not share the author's views. News and research are not personal recommendations to deal. All investments can fall in value so you could get back less than you invest.
Published by
07 Sep 2023
The Bank of England Governor said rates were “much nearer now to the top of the cycle” following 14 consecutive rises in borrowing costs.
Sterling slumped to a three month low of $1.25 against the dollar following his comments, while money markets slashed bets on another rate rise at the next meeting of the Monetary Policy Committee (MPC) later this month.
Mr Bailey said: “Many of the indicators are now moving as we would expect them to move and are signalling that the fall in inflation will continue.”
He added that the drop in inflation “will be further quite marked by the end of this year”.
So far inflation has fallen from a peak of 11.1pc last October to 6.8pc in July. A rise in petrol costs is expected to push up consumer price inflation briefly in August before continuing the downward trend.
It suggests the Bank may soon be able to stop raising interest rates, which have so far surged from 0.1pc in
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