BoE Bailey: My pre-occupation at the moment is inflation

BoE Governor Andrew Bailey, in a speech delivered today, expressed his deep concern over the current inflation rate, which he described as “unacceptably high.”

Bailey stated, “My pre-occupation at the moment is inflation. Currently at 8.7% in the latest data, consumer price inflation is unacceptably high, and we must bring it down to the 2% target.”

In response to these inflationary pressures, Bailey highlighted that monetary policy has been tightened. “Over the last twenty months, we have raised Bank Rate by nearly five percentage points,” he said.

He expressed expectation for underlying inflationary pressures to ease off as headline inflation recedes, adding that “some of that tightening is still to come through the policy pipeline.”

However, Bailey made it clear that the Monetary Policy Committee remains vigilant, monitoring various economic developments, notably in the labour market, wage growth, and services price inflation, “to assess whether pressures are proving more persistent.”