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U.K. Zero Inflation Threat Quashes BOE Rate Dissent: Economy

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The two Bank of England policy makers pushing for an interest-rate increase dropped their call this month as inflation risks falling below zero. The pound declined.

In its first unanimous decision since July, the nine-member Monetary Policy Committee led by Governor Mark Carney forecast that U.K. inflation may drop to zero in the first quarter and there’s a “roughly equal chance” it could go below that level. Policy “could and would be adjusted” if needed to meet the 2 percent price target.