The BoE has spooked everyone by forecasting a peak in the rate above 13% this northern hemisphere autumn
People walk through the financial district of Canary Wharf, London, Britain. File photo: REUTERS/AFOLABI SOTUNDE
With the unenviable record of becoming the first G7 economy to see inflation top 10% amid the current global price spike, the Bank of England has already spooked everyone by forecasting a peak in the rate above 13% this autumn followed by the longest recession since the global financial crisis 14 years ago.
“The path is set for a scorching summer of price rises to merge into a pretty awful autumn and a winter of woe as households struggle against this tide of inflation,” Hargreaves Lansdown's Susannah Streeter said this week. WIth losses of just 9% in dollar terms so far this year, that beats the S&P500, Japan's Nikkei225 and the Eurozone's Stoxx600 — as well as MSCI’s global index.
But even then, the UK underweight was substantially less than the whopping net 34% of negative positions in wider European stocks — a reading that is two standard deviations below long-term averages.
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