BoE’s Bailey: Rate cuts this year are not unreasonable

The Bank of England (BoE) governor Andrew Bailey indicated on Friday that markets can anticipate more than one interest rate cut this year, saying he is increasingly confident inflation is heading towards the target, per the Financial Times. 

Key quotes

“All our meetings are in play, we take a fresh decision each time.”

“The global shocks are unwinding and we are not seeing a lot of sticky persistence coming through at the moment. That is the judgment we have to keep coming back to.”

“Need to have confidence that wages are heading in the right direction.”

“Don’t need to wait for inflation to drop to 2% before cutting rates.”

“Recent economic developments are obviously good news.”

“The job on inflation is not done but what we are seeing is encouraging.”

Market reaction

At the time of writing, GBP/USD is trading at 1.2636, losing 0.19% on the day.