In an interview with West Midlands Magazines’ Editor, Simon Archer, Bank of England (BoE) Governor Andrew Bailey said that there is still some further journey down in interest rates to go.
“But exactly when that will be and how much it will be will depend on the path of inflation going down,” Bailey added, while noting that there is some softening in the labor market, alongside cautiousness among consumers.
“People are being quite cautious at the moment. Of course, that affects spending, so that has an effect on the state of the economy because there isn’t as much,” he elaborated. “People aren’t going out as much, they’re not shopping as much, they’re not going out to restaurants and so on as much that affects the overall state economy.”
Market reaction
These comments received a dovish score of 3.0 from FXStreet BoE Speech Tracker.
Pound Sterling remains under bearish pressure following these remarks. At the time of press, GBP/USD was down 0.7% on the day at 1.3430.