BoE’s Mann focuses on forward-looking indicators after last year’s soft patch

BoE MPC Catherine Mann commented overnight on the -0.3% quarterly contraction in GDP for Q4 2023. She characterized this period as a “soft patch,” adding that the downturn was anticipated and aligned with her expectations.

Rather than dwelling on past performance, Mann is directing her attention to forward-looking indicators, such as business surveys and PMIs, along with BoE’s Decision Maker Panel. “Those are all looking good,” she said.

However, Mann voiced ongoing concerns regarding the persistence of services price inflation in the UK, which she believes is more tenacious than in other advanced economies.

She added that decline in goods price inflation alone would not suffice to sustainably anchor consumer price inflation to the Bank’s 2% target.