BoE's Greene: There is a risk inflation expectations will rise

Eren Sengezer FXStreet

Bank of England Monetary Policy Committee member Megan Greene said on Wednesday that if their inflation forecasts are right, there is a risk inflation expectations will rise, per Reuters.

Key takeaways

"Lots of reasons why situation now is different to 2022-23."

"Rates are higher, more slack in the economy compared with 2022-23."

"Trade-off for monetary policy could be bigger this time with greater downside risks for the economy."

"Workers and companies might be faster to respond to inflation effects this time."

"Just because household inflation expectations rose, does not necessarily mean we will get second round effects but could signal higher risk."

"I was not tempted to vote for a rate hike last week."

"Financial conditions have tightened, will have implications for the economy."

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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