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MNI BRIEF: BOE 2% Inflation Goal Renewed, OBR Sees Overshoot

MNI (LONDON) - Chancellor of the Exchequer Rachel Reeves reaffirmed the inflation target for the Bank of England at 2.0% on the CPI measure and the official fiscal forecaster, the Office for Budget Responsibility, predicted a slight but persistent overshoot based on market rates.

The OBR forecast that CPI inflation would average 2.5% in 2024, 2.6% in 2025, 2.3% in 2026 and 2.1% in 2027 and 2028, only falling back to the 2.0% target on average in 2029 -- with forecasts at all points above the Bank of England's own forecasts from the August Monetary Policy Report.

Reeves announced that she was aiming to keep the current budget in balance and total tax rises in the Budget amounted to GDP40 billion. The OBR forecast that the current budget deficit would be GBP26.2bn in 2025-26, GBP 5.2bn in 2026-27 and would record a GBP10.9 billion surplus in 2027-28 and a GBP9.3bn in 2028-29 and £9.9bn in 2029-30. (see MNI INTERVIEW: UK Budget Investment Spending To Curb Rate Cuts )

MNI London Bureau | +44 203-586-2223 | david.robinson@marketnews.com
Bank of EnglandGlobalPolicy NewsCentral Bank NewsHomepageCEEMEABriefUKStoryRegion
MNI London Bureau | +44 203-586-2223 | david.robinson@marketnews.com
Bank of EnglandGlobalPolicy NewsCentral Bank NewsHomepageCEEMEABriefUKStoryRegion

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