BoE's Pill: A more cautious withdrawal of monetary policy restriction may be appropriate

There is a risk that self-sustaining inflationary dynamics embed in expectationsMust guard against cutting too far or too fastVote to maintain rates is a skip rather than a haltContinue to see rate cuts if the economy evolves as forecastNeed to recognise CPI stubbornness as more pressingShocks could prompt policy changes either wayPill has made similar comments recently, so these are not new. There’s been a slow but clear shift of focus in the MPC towards inflation recently. That shouldn’t be too surprising given the elevated inflation and wage growth, and rising consumer inflation expectations.
This article was written by Giuseppe Dellamotta at investinglive.com.

🔗 Read Full Article