Sir Mervyn King slams government for rising inflation
Sir Mervyn King has criticised the government for adopting measures that resulted in the rise of inflation in the UK. He described some the measures as `own goal' by the government because it led to the rise in inflation.
The Governor of the Bank of England pointed out that some measures like green taxes and tuition fees have led to an increase in inflation. He said that the pressure on living standards is likely to continue for another three years due to rising prices and stagnating wages in the UK.
"Whether it's on financing education, green policies or other policies, what they have done is push up prices and that clearly makes our job in the short-run more difficult," Sir Mervyn said.
Sir Mervyn said in the opening remarks of the Bank's quarterly Inflation Report press conference that increases in university tuition fees and domestic energy bills contributed to a rise in inflation. This made it difficult for the central bank to achieve official targets.
Annual CPI inflation was recorded at 2.7 per cent in January, which is above the 2 per cent target. The central bank now expects the inflation to remain above the target until 2014.