BoE’s Pill signals rate cut discussions in upcoming meetings

BoE Chief Economist Huw Pill expressed growing confidence in the possibility of lowering interest rates and stated that the committee would start discussing it “over the next few meetings”.

“We’re growing more and more confident that we can begin to reduce the restriction that monetary policy is putting in the economy and start to cut interest rate,” Pill said at a Q&A session organized by the central bank yesterday.

Pill emphasized that the Bank is not quite ready to make these adjustments, stating, “We’re not quite there yet, and we need more evidence.”

Yet, he also mentioned, “In the absence of big new disturbances in the economy, we’re going to be thinking about moving interest rates over the next few meetings.”

This commentary came after the Bank’s decision to maintain the interest rate at 5.25%, a decision supported by an 8-2 vote. Deputy Governor Dave Ramsden joined Swati Dhingra, the usual dove, in voting for a rate cut, signaling a slight shift towards a more dovish stance within policy-setting committee.