Bank Of England Raises Inflation Outlook

The Bank of England on Wednesday raised its short-term outlook on consumer-price inflation, and also lowered its outlook for British growth.

The BOE’s quarterly inflation report projected that inflation is now “likely to remain above the 2% target for the next year or so,” which is higher than expected three months ago. At the time of the central bank’s last report, in March, CPI stood at 3.5%, down from 5.2% in September of last year. The BOE said that “the prospects for U.K. growth remain unusually uncertain,” as it said that “the single biggest threat to the recovery stems from the challenges within the euro area.”

Earlier, Britain’s Office for National Statistics said the number of people claiming jobless benefits fell sharply in April. Stocks on the benchmark FTSE 100 index  accelerated losses on the news and were recently down around 1%.