• Bank of England predicts growth at 2.9% in 2015, 2.9% in 2016 and 2.7% in 2017
  • Inflation is forecast to be 0.6% in 2015, rising to 1.8% in 2016 and 2.1% in 2017
  • Average earnings growth is forecast to strengthen to 3.5% in 2015, edging up to 4.0% in 2016 and 2017

Commenting on the Bank of England’s (BoE) Quarterly Inflation Report, David Kern, Chief Economist at the British Chambers of Commerce (BCC) said:

“This inflation report conveys a positive message for UK economic prospects, with an upgrade in growth for 2016 and 2017. While the Bank of England’s growth forecast is higher than our own, we share their optimism that the UK economy has a good chance to regain stronger momentum in the medium term.

“While the downgrade in the Bank of England’s inflation forecast indicates there may be some temporary deflation this year, there is very little risk of persistent deflation. By the end of 2017, inflation should move slightly above the 2% target. With inflation forecast to remain low, the case to keep interest rates on hold for a prolonged period is strengthened further.”