6 April 2023 - Banking crisis may help BoE tame inflation
The apparent disagreement that has surfaced between members of the MPC has raised the level of uncertainty about what the Bank of England will do next. Silvana Tenreyro believes that even one more rate hike may cause inflation to fall too far and drive deflation as demand collapses. Huw Pill, the Bank’s chief economist on the other hand, believes that the current policy is correct since, having travelled so far down the road, it would be foolish to stop now. It will be dangerous for the credibility of the MPC if factions develop, particularly if the various department heads at the Bank appear split on what action needs to be taken next. The UK services sector produced another encouraging performance to offset the continued decline of Manufacturing. Beyond Currency Market Commentary: Aims to provide deep insights into the political and economic events worldwide that can cause currencies to change and how this can affect your FX Exposure.