British businesses are seeing costs rise far more slowly than the headline inflation rate, signalling that price increases are set to return to the Bank of England's target, according to leading economic analysts.
Fathom Consulting said its new analysis supports the policy of keeping interest rates low, ahead of the Bank's updated forecasts which are today expected to downgrade Britain's economic prospects for the fourth quarter running, writes the Telegraph. Weaker growth, combined with a largely unchanged medium-term inflation picture, will give Governor Mervyn King ammunition to say he is vindicated in his decision to hold interest rates at a record 0.5pc low, despite over-target inflation. MORE...
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