The BOE expects economic growth to slow down sharply this year, while they expect inflation to remain elevated above their 2% target due to rising energy and prices along with wage pressures, yet they see inflation to drop later this year, the BOE also said that the ongoing turbulence in the financial markets remains a threat due to rising short term volatility, though the falling Pound in the last period helped economical growth in the U.K.
Mr. Trichet on the other hand remained Hawkish as he stressed the ECB are still focused on inflation which rose to a 14-year high at 3.3 percent on rising food and energy prices, the short term outlook for inflation remains highly elevated above the 2% target, while on the medium term the outlook remains for upside risks to price stability.
On the 15-nation economical growth, the ECB president indicated that the economy continues to grow on a moderate pace, yet uncertainty remains high concerning the outlook for growth, but Mr. Trichet stressed that anchoring inflation expectations is the ECB's "highest priority", over the medium to long term.
