17.10.2025 11:17
Bank of England (BoE) Chief Economist Huw Pill indicated on Friday that a more measured approach to unwinding monetary policy tightening might be advisable. Amid ongoing economic uncertainties, Pill emphasized the prudence of a gradual and cautious withdrawal of restrictive measures.
He further articulated concerns regarding the potential for persistent inflationary dynamics to become deeply ingrained in public and market expectations. Pill underscored the importance of preventing excessively rapid or deep interest rate reductions, cautioning against cutting either "too far" or "too fast" to avoid exacerbating future price pressures.
Interpreting the recent decision to hold interest rates steady, Pill clarified that this move represented a temporary pause—a "skip"—rather than a definitive "halt" in the overall policy trajectory. He affirmed that prospective adjustments in interest rates, specifically cuts, remain a possibility, contingent upon the economy developing in line with current macroeconomic forecasts.
The Chief Economist also stressed the imperative to view the persistent nature of consumer price index (CPI) inflation as a more urgent concern. He highlighted that unforeseen economic disruptions could decisively alter policy decisions, potentially leading to either tighter or looser monetary conditions depending on the nature of these shocks.
Following these remarks, the British Pound demonstrated a relatively subdued reaction against the US Dollar. The GBP/USD currency pair exhibited only marginal movement, trading modestly flat around the 1.3430 level throughout the day, as disseminated across various internet financial news outlets.
