BOE deputy Governor Charles Bean expressed his concerns regarding the strength of inflation levels where he said that the inflation levels will continue on rising in the upcoming period.

Inflation will keep the pressure on prices to accelerate further while expecting a decline in spare capacity in the economy than expected, said Bean. Given the unexpected strength of inflation in recent months, this risk has probably increased of late, adding that We shall be watching these indicators, and their impact on wages and prices, like proverbial hawks.

In addition Bean noted that inflation could indicate that the margin of spare capacity is not as large as the collapse in activity might suggest, where If all goes to plan, however, and private final demand continues to pick up the baton as the fiscal consolidation proceeds, then the margin of spare capacity will shrink and it will at some juncture become appropriate to begin withdrawing the current extraordinary degree of monetary stimulus,