View more on these topics

New Star economist predicts 4% inflation

New Star chief economist Simon Ward says inflation could reach 4 per cent this year if energy prices continue to rise, ending hopes of early base rate cuts.

The prediction comes as figures this week show that inflation hit 3 per cent in April.

Ward previously forecast that inflation would reach 3.1 per cent in July, peaking at 3.5 per cent in September and remaining above 3 per cent until February 2009.

He says a 4 per cent peak now looks plausible if retail energy prices increase by 20 per cent.

Ward says a triple whammy of bad news this week makes base rate cuts unlikely. Big rises in factory gate prices and import prices and a warning from energy supplier Centrica that prices will rise could have put paid to hopes of rate cuts.

Ward says: “The view that the monetary policy committee should continue to cut rates because a weakening economy will ensure inflation is back below target in two years time is questionable.”


Leading Edge June – Investment panel debate

RLAM’s asset class specialists discuss some of the findings from the panel session at our recent Investment Conference. By Rob Williams, Head of Distribution Welcome to the latest edition of Leading Edge. It has been an eventful six months since the last e-zine. The European Central Bank announced ongoing stimulus measures, while the immigration crisis in Europe threw the […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm