§ Mr. Malcolm BruceTo ask the Chancellor of the Exchequer why he has decided to drop the Government's previous commitment to aim for a long-term rate of inflation of 2 per cent. or less. [30003]
§ Mr. NelsonThe Government's commitment to permanently low inflation is unchanged. In his Mansion House speech on 14 June my right hon. and learned Friend the Chancellor laid down precise guidelines for the day to day operation of policy. Interest rates will be set consistently to achieve inflation of 21/2 per cent. or less, which should ensure that inflation will remain within the range 1 to 4 per cent. This would put us on course to achieve one of the best performances in Europe.