Jonathan Loynes Below Quotations

Looking ahead, rising gas and electricity bills could keep inflation close to current levels for the next few months. But we expect further falls in core inflation and fading energy effects to push the headline rate well below target in the second half of the year.

We remain comfortable with our view that interest rates will fall further this year as output remains below trend and inflation falls back below its target.

It would have been better to have left the growth forecast unchanged, but that would have lowered the inflation forecast to below its target. They are having to work hard not to have to cut interest rates.