(Bloomberg) — Bank of England Deputy Governor Dave Ramsden signaled he is less concerned about UK inflation than in previous months, a sign he may be willing to support interest rate cuts.
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The official said the risk of inflation is now tilted to the downside and that evidence that price pressures will persist have receded in recent weeks. The UK, economy, he said, is looking more like that of the euro area and less of an international outlier.
“UK CPI inflation in March was below US CPI inflation, and the April data is very likely to show the UK converging in line with euro area inflation,” Ramsden said Friday in the text of a speech he’s delivering in Washington.
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“My assessment is that the balance of domestic risks to the outlook for UK inflation is now tilted to the downside compared to the MPC’s February 2024 forecast.”
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“This leaves the UK as less of an outlier and more of a laggard in terms of recent inflation performance, and one that is now catching up quickly.”
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“Notwithstanding these uncertainties and against the backdrop of a technical recession in GDP in the second half of 2023, the UK labor market has clearly continued to loosen.
–With assistance from Philip Aldrick.
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