The Bank of England will this week warn of another two years of inflation misery as living costs soar. In a report on Wednesday, Governor Sir Mervyn King is expected to say forecasts three months ago were optimistic. He is likely to warn inflation will rise and remain above the 2 per cent target for two years. The report could also see growth forecasts downgraded again after a 0.3 per cent slump in gross domestic product in the final three months of last year. The Bank’s quarterly inflation report will be grim reading for Chancellor George Osborne and Mark Carney, who will succeed Sir Mervyn in July. Sir Mervyn King ... (full story)