- Should not assume that latest MPR forecast is a direct endorsement of market interest rate curve.
- I see risk of second round effects (for inflation).
- I remain concerned we have seen a structural change in price and wage setting in UK.
- Response of monetary policy to ensure we get CPI back to target may need to be more persistent.
Pill, alongside Mann, voted for keeping the Bank Rate unchanged at the last policy decision. He is sounding hawkish because we haven’t really seen a concrete progress in UK inflation and wage growth data.
This article was written by Giuseppe Dellamotta at www.forexlive.com.
