9 January 2023 | Other

Bank of England: price caps for energy products may provoke the growth of inflation

According to representative of the British central bank Catherine Mann, the implementation of price cap for energy products as a counter-move to a price spike may provoke the growth of inflation in other fields. It will happen due to the growth of consumer expenditures. 

On Saturday, during a panel discussion at the annual conference of the American Economics Association, which took place in New Orleans, Mann made a statement. She said that the price cap for energy products allowed to mechanically decrease the inflation rates that are important for monetary policy.

As Mann said, the price cap allowed the citizens to direct their expenditures to other elements of the consumption bundle. Then, the inflation in these segments will grow. 

Also, Catherine Mann said that after the current ceiling is removed, the uncertainty related to the cost of raw materials will be high. 



Company MarketCheese
Period: 01.05.2025 Expectation: 1000 pips
GBPUSD to test level of 1.34 again
25 April 2025 55
Brent sell
Period: 01.05.2025 Expectation: 660 pips
Trade uncertainty and excess OPEC+ supply are dragging down Brent
25 April 2025 40
Period: 29.04.2025 Expectation: 600 pips
USDCAD to head towards 1.39400 after rebounding from 1.38200
25 April 2025 35
Period: 02.05.2025 Expectation: 1669 pips
AUDCAD gains on potential easing of trade tensions between US and China
25 April 2025 35
Period: 30.04.2025 Expectation: 12000 pips
ETHUSD set to test upper boundary of downtrend channel
24 April 2025 90
Period: 25.04.2025 Expectation: 500 pips
AUDUSD to fall to 0.63000
24 April 2025 45
Go to forecasts