3 min
1 September 2023 - Are you on #TeamUnder or #TeamOver? Beyond Currency
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- Business
Huw Pill, the Chief Economist at the Bank of England spoke yesterday of the determination of the Bank to “see through to the end” its fight against inflation.
Many observers took that as a hint that there will be another twenty-five-basis point hike in interest rates when the MPC meets again in three weeks’ time.
Pill went on to say he and his colleagues are aware of the unnecessary damage that could be inflicted on the economy if rates are raised too much, but the Bank feels it must concentrate primarily on tackling inflation. Interest rates are likely to stay elevated for some time.
Inflation fell to 6.8% in July and while it can be considered to be moving in the right direction, the base rate needs to be at a level where it is restricting demand, but not severely affecting employment and growth unnecessarily.
The most recent employment data shows that there is still capacity since the claimant count is constant, while he feels that the country can avoid a recession in the coming months.
Beyond Currency Market Commentary:
Aims to provide deep insights into the political and economic events worldwide that can cause currencies to change and how this can affect your FX Exposure.
Huw Pill, the Chief Economist at the Bank of England spoke yesterday of the determination of the Bank to “see through to the end” its fight against inflation.
Many observers took that as a hint that there will be another twenty-five-basis point hike in interest rates when the MPC meets again in three weeks’ time.
Pill went on to say he and his colleagues are aware of the unnecessary damage that could be inflicted on the economy if rates are raised too much, but the Bank feels it must concentrate primarily on tackling inflation. Interest rates are likely to stay elevated for some time.
Inflation fell to 6.8% in July and while it can be considered to be moving in the right direction, the base rate needs to be at a level where it is restricting demand, but not severely affecting employment and growth unnecessarily.
The most recent employment data shows that there is still capacity since the claimant count is constant, while he feels that the country can avoid a recession in the coming months.
Beyond Currency Market Commentary:
Aims to provide deep insights into the political and economic events worldwide that can cause currencies to change and how this can affect your FX Exposure.
3 min