In an interview with The Guardian, BoE Governor Andrew Bailey highlighted that cost of living pressures have not been as persistent as the Bank previously feared, which could open the door for more proactive rate cuts.
He noted that if positive inflation data continues, the BoE may adopt a “more activist” stance on reducing interest rates, which currently stand at 5%.
However, Bailey also pointed to geopolitical risks, particularly in the Middle East, as a threat. “Geopolitical concerns are very serious,” he said, acknowledging that ongoing conflicts could add strain to already “stretched markets.”
