"I can envisage the conditions for considering tightening being met somewhat sooner than I had previously expected," Bank of England (BoE) Deputy Governor Dave Ramsden said on Wednesday, as reported by Reuters.
Additional takeaways
"There is still real uncertainty as to what path the economy will take."
"I put more weight on my inflationary than my disinflationary scenario."
"There should no presumption that the recent strength in demand and inflation will be sustained."
"I agree with the initial MPC assessment on transitory inflation."
"While I do currently put less weight on my disinflationary scenario, it is too early to rule it out."
"I will monitor closely if the transitory increase in inflation and wages generates expectations of a more sustained rise in inflation."
"As of now, the near-term strength in UK inflation is expected to be transitory."
"As and when conditions for considering tightening are met there is also the question of how we might tighten policy."
"How rapidly the balance of sectoral demand and supply adjusts will be one factor that determines how quickly inflation returns to target."
"Choosing the precise direction of travel for monetary policy is becoming less straightforward."
"Inflation is already overshooting the target, and it is less clear, at least to me, that there remains a degree of spare capacity."
"At a whole economy level, I wouldn’t be surprised to see the whole economy cpi inflation rate potentially rising as high as 4%."
"The whole economy CPI inflation rate could rise as high as 4% for a period later this year, before falling back towards the 2% target."
"Inflation could fall back faster in the medium term, not just towards but potentially back below our 2% target."
"The downside risks to gdp and inflation from covid remain clear and present."
"There are certainly upside risks to household spending."
"Quite possible that unemployment could peak lower than our May MPR forecast."
Market reaction
The GBP/USD pair showed no immediate reaction to these comments and was last seen gaining 0.35% on a daily basis at 1.3857.
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