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UK inflation could go “above five per cent” this winter says new BoE chief economist

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UK inflation could rise above five per cent next year, said the Bank of England’s new chief economist.

Speaking to The Financial Times, Huw Pill said: “I would not be shocked — let’s put it that way — if we see an inflation print close to or above five per cent [in the months ahead]. And that’s a very uncomfortable place for a central bank with an inflation target of two per cent to be.”

He also told the FT that the decision on whether to raise interest rates next month was “finely balanced.”

Pill declined to reveal how he would vote on the issue at the bank’s monetary policy meeting next week

While he believed that inflation was likely to decline in the second half of 2022, he was uncomfortable with the sharp price rises expected over the next six months.

Pill’s comments follow warnings from governor Andrew Bailey that the central bank would “have to act” to keep a lid on inflation.