BoE: Expect two more years of above-target inflation

The Bank of England's Monetary Policy Committee (MPC) has said inflation may remain above the 2% target for the next two years, in part due to sterling weakness.

In a rare statement accompanying today's monetary policy decision, the MPC said inflation is expected to fall back to its target level after that point. The forecast represents a further extension of the committee's time horizons, Bank of England governor Mervyn King having said in December he did not expect inflation to fall back below 2% until Q3 2014. "CPI inflation is likely to rise further in the near term and may remain above the 2% target for the next two years, in part reflecting a persistent inflationary impact both from administered and regulated prices and the recent declin...