BoE MPC member Jonathan Haskel emphasized the importance of caution when interpreting UK’s recent decline in headline inflation to 4% in December. While acknowledging this positive trend, he stressed the necessity of focusing on more enduring aspects of inflation.
“I’m not going to apologize for banging on about persistence because I think we’re right to,” he asserted. Particularly concerning to Haskel are the underlying measures of price growth, especially within the services sector. Despite the headline inflation drop, these measures have recently plateaued at an annual rate of approximately 6.5%, a level Haskel considers still too high.
“The signs that we’ve seen thus far are encouraging. I don’t think we’ve seen quite enough signs yet,” Haskel remarked. “But if we accumulate more evidence on persistence, then by the very logic I’ve just set out, I’d be happy to change my vote.”
Haskel, who supported another rate hike in the last MPC meeting, described his decision as “finely balanced,” highlighting his desire for more time to assess the inflationary trend’s durability.
