Central Banks
A Year of Bad Inflation Forecasts Casts Doubt on BOE Rate Path
- Not once last year did economists correctly predict CPI data
- Trend likely to make policy makers more cautious in outlook
This article is for subscribers only.
Britain’s economists are finding it increasingly difficult to forecast inflation, a phenomena that’s upending markets and is likely to make the Bank of England more cautious about lowering interest rates.
Not once in the past year did the consensus estimate of economists match the figure reported by the Office for National Statistics, the worst record in the Group of Seven economies, an analysis of Bloomberg surveys shows. For four months of 2023, inflation fell outside the range of estimates predicted by the group of UK forecasters, also under-performing the rest of the G-7.