© Reuters. FILE PHOTO: Shoppers look at bread in a Sainsbury’s supermarket, amid the coronavirus disease (COVID-19) outbreak, in London, Britain January 12, 2021. REUTERS/Henry Nicholls
LONDON (Reuters) – A current spike in consumer goods prices does not point to longer-term persistence in inflation, Bank of England Deputy Governor Ben Broadbent said on Thursday, pointing to labour market signals as a better gauge of price growth ahead.
With top officials at the British central bank split on the need to remove their stimulus for the economy quickly, Broadbent highlighted how inflation pressures in the past had subsided and how the British job market usually did not amplify price shocks.
“While we know it’s going to go further over the next few months, I’m not convinced that the current inflation in retail goods prices should in and of itself mean higher inflation 18-24 months ahead, the horizon more relevant for monetary policy,” he said.
“The outlook for aggregate demand growth still matters. And...read more...