BoE’s Bailey: MPC does not think it likely that negative rates will be needed

“Transitory CPI developments should have few direct implications for inflation over the medium term,” Bank of England (BoE) Governor Andrew Bailey said on Monday, as reported by Reuters.

Additional takeaways

“Inflation expectations remain well-anchored.”

“In the medium-term, the MPC judges that the pace of expansion in UK GDP slows as supply growth returns to its subdued longer-term trend.”

“MPC does not currently think it likely that negative rates will be needed.”

“Current guidance on QE unwind is too prescriptive.”

Market reaction

These comments don’t seem to be having a significant impact on the British pound’s performance against its rivals. As of writing, the GBP/USD pair was up 0.1% on the day at 1.4160.

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