BoE MPC member Megan Greene expressed concerns today during a seminar about the economic repercussions of ongoing tensions in the Middle East. Highlighting the region’s significance, Greene pointed out the risks associated with an energy price shock and other supply side disruptions, which could complicate the inflationary landscape further.
“I do think that what’s going on in the Middle East does pose a risk,” Greene remarked. “I’m worried about the sort of an energy price shock and other supply side shock, which obviously follow a number of supply side shocks we’ve seen over the past couple of years, and what that might do to inflation expectations.”
Greene also addressed the challenges involved in reducing inflation to the Bank’s target of 2%, noting that the final steps in this process are particularly challenging. “The ‘last mile’ of the journey towards hitting the 2% inflation target was the hardest part,” she stated.
