BoE Governor Andrew Bailey acknowledged the existence of “some evidence of some tightening credit conditions” during today’s parliamentary hearing, addressing concerns surrounding the current financial market turmoil. Despite the tightening, Bailey remains optimistic, stating that “we do not see a critical development in that respect.”
The Governor emphasized that the BoE always considers credit conditions when setting monetary policy and expressed confidence in the bank’s ability to assess the impact of raising interest rates on the position of the banks themselves.
Deputy Governor Dave Ramsden shared similar sentiments, acknowledging the importance of vigilance regarding the risks higher interest rates might pose to other parts of the economy. He added that the current environment is “volatile and challenging,” highlighting the need for careful monitoring and assessment by central bank officials to ensure financial stability and well-informed policy decisions.