Barclays chief: Inflation is good

Incoming Barclays chief executive Bob Diamond told Sky News “a whiff of inflation would be good news for the economy,” yesterday.

Inflation rose to 3.3 per cent last month, and inflation expectations have jumped to 3.9 per cent.
And 61 per cent of people think rising prices will weaken the economy.

“Inflation erodes the value of wealth and incomes, which can squeeze household spending and reduce retail sales,” said Samuel Tombes of Capital Economics.