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Following the comments from the BOE Chief Carney, the central bank policymaker Tenreyro said that “in my view, persistent weakness in price pressures relative to labour costs is a downside risk to the MPC’s inflation forecast- annual report to parliament dated Feb. 19.”

Additional comments

In report a stronger rebound may be needed – towards the top end of the range suggested by the surveys – to remove the case for near-term stimulus.

In report outlook will also depend on the stance of fiscal policy chosen by the new government in the next budget.

In report more expansionary measures would require less monetary policy support to meet the inflation target.