BoE Governor Andrew Bailey told BBC radio, “we watch rates in financial markets very closely.” “We have seen some increase in rates over the last month or so as have other countries,” he said. “My view is that is consistent with the change in the economic outlook.”
“Our current view of inflation is that it will get back towards our 2% target,” he added. “It will get back towards that level in the next two or three months. The important question here is: will that be sustained?”
“I’m saying we will need to see evidence that the trend in the economy and therefore the trend in inflation is sustainable simply because of the uncertainty and the huge effect of the Covid shock.”
“This Covid effect on the economy is huge so what we are saying on the recovery is the economy will get back by the end of this year to where it was at the end of 2019. That’s good news but let’s be realistic: it’s no more than getting back to where we were pre-Covid.”
