A Framework That Provides Clarity

During periods of “low visibility,” confusion reigns: for every indication of one trend, there seems to be a countertrend. The key is to glean from the collective wisdom of reliable leading indicators a clear signal that the economy is headed for a turn.

All Reports

Jul 02 2014

Will BoE Reverse Course with U.K. Inflation Below Target?

ECRI has just updated its United Kingdom Future Inflation Gauge (UKFIG). The value of this forward-looking gauge lies in its ability to predict cyclical turns in U.K. inflation.

For the fifth consecutive month, U.K. inflation has been below the Bank of England’s (BoE) 2% target rate, dropping to 1.5% in May, a four-and-a-half-year low. According to the consensus, the timing of Easter this year was likely to have had an impact on the inflation rate, mainly on travel costs, which increased to coincide with the April holiday.

The latest update to the UKFIG clarifies the future trajectory of U.K. inflation, indicating whether it will continue to reside below the BoE’s target, or reverse course.

Related News & Events

Cognitive Dissonance at the Fed?

ECRI May 30, 2014

As Fed and CBO trend growth estimates fall to the Fed's 2% recessionary stall speed, how does economy reach escape velocity? More