Chancellor defends King on inflation

clock

The Chancellor has defended the Bank of England over rising inflation and denied the government is making its job more difficult.

In particular he denied the decision to raise VAT to 20% at the start of last month was making conditions harder for the Bank, dismissing its effect as a one-off. "I think any monetary authority can see through temporary increases in price levels to look to permanent threats to inflation," he said. His comments come as governor Mervyn King is under pressure over the decision to keep interest rates at their record low of 0.5% for two years, despite rising prices. However, Osborne said he had faith in King and the MPC despite inflation hitting 4%, which is double the target figure, ...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Economics / Markets

Why investors 'can't outrun' slow-moving demographics

Why investors 'can't outrun' slow-moving demographics

'Demographic change is a key megatrend'

Darius McDermott
clock 07 March 2024 • 5 min read
Spring Budget 24: Ten key takeaways from Jeremy Hunt's speech

Spring Budget 24: Ten key takeaways from Jeremy Hunt's speech

British ISA, Office for Budget Responsibility, tax cuts

Valeria Martinez
clock 07 March 2024 • 4 min read
Spring Budget 24: Chancellor unveils long-term UK growth plan

Spring Budget 24: Chancellor unveils long-term UK growth plan

Includes British ISA launch and further NI cut

clock 06 March 2024 • 1 min read