Andrew Sentance has made his most outspoken attack yet on the Bank of England's economic forecasts, saying they understated inflation risks and the need for a rate hike. A long-standing hawk on the Bank's rate-setting committee, having voted for higher interest rates since last June, Mr Sentance made his growing frustration with the Bank's record on forecasting inflation clear.
"My judgement is that the upside risks to inflation are understated in the published fan charts. And monetary policy would most likely need to be tightened faster and by more than the markets currently expect to bring inflation back to target," Mr Sentance told a conference in London. The Bank's Governor, Mervyn King, recently warned markets not to get ahead of themselves in pricing in rate rises.