What is CPI?
History?
Although core UK inflation is expected to remain steady, headline CPI is expected to tick higher in June. Economists expect annualized core inflation to rise 1.5% following a matching increase in May. Headline inflation is expected to rise 3.6% following the previous rise of 3.3%.
Bank of England governor Mervyn King reiterated Monday he expects inflation to return to the CPI annual rate of 2.0 percent in two years.
In his foreword in the central bank's annual report, King also said the nine-strong rate-setting Monetary Policy Committee is determined to bring inflation back down from the current record high of 3.3 percent.
Still, for the time being, the CPI annual rate will stay above 3.0 percent until well into 2009, he added.
King said rate setters continue to face the same dilemma at their monthly meetings.
'... we have had to balance this risk that inflation expectations might be dislodged against the possibility that inflation might fall below the target,' he said.
'These are judgements the committee must continue to make month by month,' he added.
Last price action on CPI news for Gj & GU
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