BoE/Greene: Caution Advised in Interest Rate Cuts

Forex - Bank of England (BoE) policymaker Megan Greene expressed her concerns regarding core inflation pressures in the UK, advocating for a cautious approach to interest rate cuts. Speaking at an event in London, Greene emphasized that while inflation is declining, the fight to keep it under control is not over yet. She noted that service sector inflation and wage increases are higher than desired for the 2% inflation target, posing a risk of persistent inflation.

Greene's hawkish stance within the Monetary Policy Committee reflects her belief that, despite only two interest rate cuts this year, there should be no rush to further ease monetary policy. She also highlighted that the UK economy is increasingly vulnerable to external economic shocks, particularly similar to those affecting the US Treasury curve.

BoE Governor Andrew Bailey and other officials are expected to maintain a consistent stance on interest rates in light of the expansionary budget announced by the new Labour Party government and potential global trade tensions.