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IHS Global Insight economist Howard Archer said commodity price falls have "diluted upside risks". That could mean inflation peaking at about 3% during the summer, he said.
Outgoing Bank of England Governor Sir Mervyn King could deliver a rare dose of economic optimism by nudging up the UK's growth prospects in his final inflation report today.
Economists believe recent encouraging signs from the economy could see the Bank hold or even lift growth forecasts, while it is also expected to trim its quarterly inflation forecast on the back of recent falls in oil and commodity prices.
Britain eked out growth of 0.3% in the first quarter and a recent trio of positive surveys for April showed improved growth from the service sector, near-stabilisation in construction and improvements in manufacturing.
The quarterly inflation press conference is Sir Mervyn's last before he hands over to new governor Mark Carney in July.
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The outgoing Governor of the Bank of England today delivered some good news for "the first time since the financial crisis began" in 2007.
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