Credit Suisse has joined the list of brokers predicting UK inflation will surge next year, though its forecasts are slightly lower than rivals Goldman Sachs (NYSE:GS) and Citibank.
The Swiss bank expects UK inflation (CPI) to peak at 15% in January 2023 and to average 10.5 % through the course of 2023, compared to 9.6% over 2022.
However, Credit Suisse’s forecast comes with heavy caveats about the direction of energy prices and “the effectiveness of government intervention to mitigate the rise via the price cap”.
On Monday, the EU said that it intends to intervene in the market and introduce structural reform to how electricity prices are set across the eurozone.
Goldman Sachs yesterday predicted UK inflation might hit 22.4% early in 2023 if the energy price cap rises by 80% in January, while Citibank has forecast a rise in CPI to 18.6% again largely due to the surge in the cost of gas and electricity.