FOREX TradingCharts.com

Financial News: BoE's Greene Seeks Cautious Approach On Concerns Over

BoE's Greene Seeks Cautious Approach On Concerns Over High Inflation, Uncertainty

06/24/2025 - 11:55:00 (RTTNews)

(RTTNews) - The Bank of England must have a prudent approach to reducing interest rates as the U.K. inflation may remain high for a longer time than expected rather than a short-term spike, and also due to risks on the global front including fluctuations in oil prices in the backdrop of the ongoing Middle East conflict, policymaker Megan Greene said on Tuesday.

"I worry about the near-term profile for inflation this year, which in my view now resembles more of a "plateau" than a "hump"," Greene, a member of the Monetary Policy Committee, said in a speech at the think tank National Institute of Economic and Social Research.

Headline <a href=https://www.rttnews.com/3547370/uk-inflation-slows-slightly-in-may.aspx target=_blank >consumer price inflation was 3.4 percent in May</a>, which was slightly slower than the 3.5 percent in April, but well above the central bank's 2 percent target and exceeded expectations. Core inflation that strips out volatile items eased to 3.5 percent from 3.8 percent.

The BoE expects inflation to resume its return to the target from early next year. Greene pointed out that there is a risk that high inflation of 3.5 percent could last longer for the rest of the year and feed into inflation expectations as well as influence wage and price setting behavior.

Further, household inflation expectations are elevated as food prices have consistently surprised to the upside, and business' price growth expectations are also high, Greene noted.

"The risk that our near-term plateau in inflation feeds through into second round effects is skewed to the upside," Greene said. "This is even more a concern in light of the escalating conflict in the Middle East, which poses upside risks to oil prices."

Last week, the U.K. central bank left the <a href=https://www.rttnews.com/3547621/bank-of-england-holds-rate-steady-on-higher-inflation.aspx?refresh=1 target=_blank >bank rate unchanged at 4.25 percent</a>. Greene was among the rate-setters who voted to hold the rate steady.

"Noisy data means that it will take longer for me to take comfort from recent disinflationary trends," Greene said. The central banker also observed that the uncertainty caused by the U.S. trade tariffs, the federal budget and the Middle East conflict is unlikely to subside soon.

Therefore, "a careful and gradual approach to removing monetary policy restrictiveness continues to be warranted," Greene added.

The policymaker also said that financial arbitrage opportunities for banks arise as major central banks - the Fed, ECB and BoE, are reducing their security holdings as part of their balance sheet normalization efforts. However, the scope of these opportunities is "fairly limited", Greene added.

"The willingness of banks to identify and act on pricing differentials is a feature of our system, not a bug," Greene said.

For comments and feedback: contact editorial@rttnews.com

Copyright(c) 2025 RTTNews.com. All Rights Reserved

Market News provided by RTTNews

RECENT INTERNATIONAL FINANCIAL NEWS


Russia Slashes Interest Rates Again On Easing Price Pressures (01 hr(s), 59 min(s) ago)
(RTTNews) - Russia's central bank lowered the key interest rate massively for a second policy ...Full Story»

UK Retail Sales Rebound As Warm Weather Boosts Spending (03 hr(s), 26 min(s) ago)
(RTTNews) - UK retail sales recovered in June as warm weather boosted consumer spending but consum ...Full Story»

Eurozone Bank Lending Growth Improves (04 hr(s), 19 min(s) ago)
(RTTNews) - Eurozone bank lending increased at a faster pace in June despite trade tariff concerns ...Full Story»

Russia Central Bank Cuts Interest Rate By 200 Bps (05 hr(s), 20 min(s) ago)
(RTTNews) - Russia's central bank slashed its benchmark rate by 200 basis points on Friday cit ...Full Story»

German Business Sentiment Strongest In More Than A Year (05 hr(s), 58 min(s) ago)
(RTTNews) - German business confidence improved to the highest level in more than a year in July d ...Full Story»

French Consumer Sentiment Improves Marginally (06 hr(s), 48 min(s) ago)
(RTTNews) - French consumer confidence improved marginally in July, monthly survey results from th ...Full Story»

Singapore Industrial Production Recovers In June (08 hr(s), 19 min(s) ago)
(RTTNews) - Singapore's industrial production growth accelerated in June, figures from Economi ...Full Story»

UK Retail Sales Recover In June (09 hr(s), 16 min(s) ago)
(RTTNews) - UK retail sales recovered in June as warm weather boosted food and non-food store sale ...Full Story»

Search

INTERNATIONAL FINANCIAL NEWS

Russia Slashes Interest Rates Again On Easing Price Pressures

07/25/2025 - 10:16 AM (RTTNews)
(RTTNews) - Russia's central bank lowered the key interest rate massively for a second policy ...Full Story>>

UK Retail Sales Rebound As Warm Weather Boosts Spending

07/25/2025 - 08:49 AM (RTTNews)
(RTTNews) - UK retail sales recovered in June as warm weather boosted consumer spending but consum ...Full Story>>

Eurozone Bank Lending Growth Improves

07/25/2025 - 07:56 AM (RTTNews)
(RTTNews) - Eurozone bank lending increased at a faster pace in June despite trade tariff concerns ...Full Story>>

Russia Central Bank Cuts Interest Rate By 200 Bps

07/25/2025 - 06:55 AM (RTTNews)
(RTTNews) - Russia's central bank slashed its benchmark rate by 200 basis points on Friday cit ...Full Story>>

German Business Sentiment Strongest In More Than A Year

07/25/2025 - 06:17 AM (RTTNews)
(RTTNews) - German business confidence improved to the highest level in more than a year in July d ...Full Story>>

Do not sell my personal information

Copyright © 2025. All market data is provided by Barchart Solutions. Information is provided "as is" and solely for informational purposes, not for trading purposes or advice. To see all exchange delays and terms of use, please see disclaimer.