Raise Bank of England inflation target to 3%, says leading thinktank

Resolution Foundation also calls for Bank to have power to set negative interest rates in response to future downturns

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The Bank of England should be set a 3% inflation target and given powers to crash borrowing costs below zero in response to future economic shocks, a leading thinktank has said.

The Resolution Foundation said Britain required a big overhaul of its economic toolkit to avoid decades of rising debt or austerity, and called for reforms at the Bank and the Treasury to get a bigger bang for each buck".