- UK inflation will fall well below 2% target
- Low wage growth, spare capacity will lower inflation
- CPI excluding currency effects, VAT, commodities is “low”
- More worried about downside house price risks than upside
- Mkt expectations of rate hike doesn’t mean it will occur
- External risks to CPI won’t offset domestic drag
- Weak pound versus euro and European demand are inflation risks
Once a dove always a dove…Posen’s view is that inflation ex-inflation is not a problem…good luck with that.
