LONDON (Reuters) – UK inflation expectations are well anchored around the Bank of England’s 2% target, Finance Minister Rishi Sunak said on Wednesday after data showed inflation exceeded the target by first time in almost two years.
Sunak said there are no signs that expectations of higher inflation are taking hold as the economy recovers from its coronavirus lockdowns.
“That’s different than what’s happening in America, so I think actually here, people’s expectation is that inflation will stay on target in the medium term, but of course that’s one of the many risks I need to be concerned about, “Sunak said in a statement. interview with broadcaster GB News.
Previously, official data showed that Britain’s consumer price index reached 2.1% in May.
Sunak also told GB News that he would not return to austerity after his 350 billion pounds ($ 490 billion) of spending to help the British economy weather the COVID-19 pandemic.
However, he said he wanted to protect the country from the blows to come and not let future generations pay off Britain’s debt.
“(And) that requires a bit of focus and prioritization,” Sunak said.
When asked if the government will keep its promise to keep its mechanism to increase state pensions, which could mean increases that continue to fast-growing wages, Sunak said the issue would be reviewed in the fall.
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