Inflation is likely to fall rapidly this year as energy prices fall, Bank of England Governor Andrew Bailey has said.
The BBC reports that Mr Bailey said a recent easing of inflation could be a sign that "a corner has been turned".
The Bank was not trying to change market expectations that interest rates will peak at 4.5%, he said.
The pandemic and the cost of living crisis meant a UK recession was still on the cards, he added.
A major component of inflation - how fast prices rise - has been soaring energy costs as economies recover from Covid and Russia's war in Ukraine pushes up oil and gas prices.
But wholesale energy costs have been falling in recent weeks, and energy bills are lower than previously forecast.
This has made the Bank more optimistic that inflation could be on an "easier path", Mr Bailey said.
However, lots of vacancies for jobs mean employees are in a stronger bargaining position for wage rises, which could help push prices up, he said.
FTSE 100
Renewed worries that the global economy could be heading for a hard landing pushed the FTSE 100 down 83.41 points, or 1.1%, to 7,747.29 yesterday, while the FTSE 250 dropped 316.79 points, or 1.6%, to 19,574.11.
Investors were spooked by a rout on Wall Street as US data illustrated a slowdown in consumer spending, while Federal Reserve officials warned of more interest rate rises.
Brent crude futures were up 0.12% at $86.26 a barrel.
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