14-05-2008
Bank of England inflation report hits sterling
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The value of sterling has been negatively affected by the publication of the Bank of England's latest quarterly inflation report, it has been claimed.
Published this week, the new report has pushed the value of sterling down to a low not seen for three months, reports the Financial Times.
And the current governor of the Bank of England, Mervyn King, has warned that during the second half of 2008, inflation may exceed four per cent.
He also noted that inflation would remain above the three per cent threshold for long than three full months.
Although the Bank of England's inflation target is set at two per cent, current data puts the indicator at a rate of three per cent.
"It is quite possible that at some point we may get an odd quarter or two of negative growth, but recession is not the central projection," said Mr King.