BoE's Weale blames energy prices for rising inflation expectations

LONDON Wed Dec 11, 2013 2:23pm GMT

The Bank of England is seen against a blue sky in the City of London October 6, 2011. REUTERS/Suzanne Plunkett

The Bank of England is seen against a blue sky in the City of London October 6, 2011.

Credit: Reuters/Suzanne Plunkett

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LONDON (Reuters) - The rise in British inflation expectations since August might be a knee-jerk reaction to higher energy bills but would be concerning if persistent, Bank of England policymaker Martin Weale said on Wednesday.

"I am concerned that those measures have gone up since August..they haven't yet risen to an extent that I would regard as significant," he said. "It's also possible of course that the increase is a consequence of the press discussion on energy prices, and therefore if energy prices become less newsworthy will go down again."

In a question and answer session following a speech in London, Weale said he was reluctant to read too much into one month's release but would be concerned if rises in inflation expectations grew more pronounced.

"If they were large enough to be economically significant, then the right thing for me to do would be to conclude that the policy had been knocked out."

(Reporting by David Milliken and Freya Berry)

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