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Carney’s Balancing Act Gets Trickier as Brexit Saga Hits Pound

  • Theresa May set to outline plans for ‘hard Brexit’ on Tuesday
  • Persistent pound weakness risks fueling faster inflation
Updated on

Mark Carney says his tolerance for faster inflation is limited, and the signs are that those limits will be tested. 

As the Bank of England governor prepares to deliver his first speech of 2017 on Monday, a report that Prime Minister Theresa May is pushing toward a so-called hard Brexit is weakening the pound. Should that persist, it has implications for consumer prices, already rising at the quickest pace since 2014, and exacerbates the tensions facing policy makers who are trying to support economic growth without letting inflation get out of hand.