Bank expects only 1.5% growth in 2008

The report also estimates inflation will rise to around 3% by the middle of 2008 before falling back to target levels in 2009, indicating the Bank is unlikely to make further interest rate cuts in the near future. The Bank of England’s Governor, Mervyn King, says the Monetary Policy Committee’s major aim is to bring inflation back within its 2% target in the medium term, but he admits the Bank faces a difficult balancing act. “The adjustment we are experiencing is part of a longrun rebalancing of the world economy that, in the United Kingdom, will mean some shift in total demand, away f...