Sterling depreciation will increase pace of tightening, BoE says

Bank of England

UK inflation is now expected to overshoot the Bank of England’s 2% target for an extended period as the effects of sterling’s depreciation feed through to import prices, the institution said today (May 11).

In its latest monetary policy statement, in which policymakers decided to leave rates on hold at 0.25%, the BoE said the overshoot was “entirely” due to the impact of weak sterling, and raising interest rates would not be an effective way of dealing with the issue.

“Attempting to offset

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