A pile of one pound coins is seen in a photo illustration shot June 17, 2008. REUTERS/Toby Melville/Illustration
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Prices are going to rise in Britain.Economists at some leading banks are predicting a leap to around 3 or nearly 4 percent by the end of next year, up from 0.6 percent in August.A Reuters poll of economists Thursday showed a wide range of forecasts for consumer price growth next year, but all agreed inflation will rise significantly from current levels.The poll's median forecast showed consumer price inflation will average 2.3 percent next year, above the Bank of England's 2 percent target.BoE policymakers have signaled they will probably tolerate rising inflation, just as the central bank did in 2011 when consumer prices increased more than 5 percent, fuelled by surging oil prices and a weakened pound following the 2008/09 recession.However, economists increasingly expect the slump in the pound so far and its knock-on effect on inflation will stop the BoE from pumping more stimulus into the economy in November, something the central bank had flagged as recently as last month.Economists at HSBC think sterling – which was trading around $1.22 Thursday – will weaken by another couple of cents before the year, a scenario that sets up the prospect of inflation running at around 3.7 percent by the end of 2017 .
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