Recent developments have raised concerns that the UK
could be facing an upsurge in price inflation over the
coming years. Since early March, oil prices have doubled;
the economy has found a firmer footing; and broad
measures of inflation expectations have shifted higher.
The rise in some of the forward-looking inflation indicators
has occurred as the Bank of England has embarked on
an unprecedented loosening in UK monetary policy.
Having cut interest rates to a record low, the Bank has
turned to the unorthodox policy of quantitative easing (QE)
in an effort to stimulate lending and demand through
expanding money supply.