BoE's Pill: There is a lot of policy-in-the-pipeline still to come through

Eren Sengezer FXStreet

Bank of England Chief Economist Huw Pill said on Tuesday that caution is still needed in assessing inflation prospects on account of the potential persistence of domestically generated inflation, as reported by Reuters.

Key takeaways

"The onus remains on ensuring enough monetary tightening is delivered to see the job through."

"There is a lot of policy-in-the-pipeline still to come through."

"Caution is still needed in assessing inflation prospects on account of the potential persistence of domestically generated inflation."

"MPC need to remain vigilant to signs of tightening financial conditions."

"I will base my may rate decision on data flow and its interpretation in the forecast."

"Recent developments in indicators of inflation persistence have been mixed."

"Wage developments, particularly higher frequency indicators of current momentum, appear to be easing."

"MPC should be cautious viewing better prospects for activity as something inherently inflationary."

"Relative to where we were a few months ago, the difficult trade-off facing monetary policy has eased."

Market reaction

GBP/USD preserves its bullish momentum on Tuesday and was last seen rising 0.75% on the day at 1.2505.

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.

AUD/USD bounces off multi-month low, nears 0.6900

AUD/USD edges higher toward 0.6900 in the Asian session on Wednesday, recovering some of the previous day’s losses to its lowest level since March as the US Dollar stalls the hot US CPI-inspired rally amid hopes of a US-Iran peace deal. Meanwhile, hawkish comments from FOMC members have almost confirmed another December rate hike, which favors USD bulls and should cap the Aussie.

USD/JPY remains capped below 159.00 amid looming intervention risks

USD/JPY struggles to build on the previous day’s strong gains to a near one-month top as intervention risk supports the Japanese Yen while hopes of a US-Iran peace deal cap the safe-haven US Dollar. That keeps the pair's upside limited below 159.00, for now.

Gold struggles near $4,050 as Fed rate-hike bets intensify

Gold (XAU/USD) trades with modest gains on Wednesday after falling 2.67% the previous day, in the aftermath of hotter-than-expected US consumer inflation data and hawkish remarks from Federal Reserve (Fed) officials that fueled expectations of a more aggressive interest rate-hike path.

Crypto Today: Bitcoin, Ethereum and XRP struggle to find footing amid spot ETF outflows

Cryptocurrency prices are broadly consolidating near key lower support levels on Wednesday, led by Bitcoin, hovering around $74,000. Ethereum sits above $2,000 while its upside remains structurally capped. Ripple, meanwhile, holds delicately above $1.00.

Ten questions for China in 2027

2026 has been a year of slowing growth and increasing divergence within China's economy. We saw the gap between external and domestic demand, as well as between the new economy and the old economy, widen significantly. Here, we look ahead to the key questions facing China in 2027.

What the US CPI headline doesn’t tell you about inflation

Brent crude has fallen about a third since mid-October on hopes the Iran war is ending, but diesel, freight and fertiliser costs haven't followed. Those costs reach US consumer prices in stages through 2027 and could keep inflation high after gasoline gets cheaper.