The Bank of England is facing an increasingly difficult balancing act in setting an appropriate monetary policy for the UK. Inflation is overshooting its 2% target by quite a wide margin. 

The UK saw a marked pick up in the pace of economic activity last year after the economy virtually stagnated in 2012. GDP expanded by 0.8% in the second and third quarters of 2013, after 0.5% growth in the first quarter.

The first estimate of UK GDP for the third quarter of this year shows that the economy’s performance continues to improve. GDP expanded by 0.8%, which follows on from a 0.7% increase in the second quarter and a rise of 0.4% in quarter one.