Beyond Currency

15th March 2022 - MPC must tread carefully


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"Silvana Tenreyro, a member of the Bank of England’s Monetary Policy Committee, spoke yesterday of the collective responsibility of the committee to carefully consider changes to interest rates considering the volatility of the financial markets due primarily but not exclusively to the conflict in Ukraine.
Tenreyro believes that the Central Bank was already facing some tough decisions even before Russian troops crossed the border into Ukraine.
With the economy yet to completely recover from the Coronavirus Pandemic, there is a real chance inflation is set to rise further. The Bank, already having hiked interest rates at its two most recent meetings, is now expected to hike again this week as the MPC reacts to the balance of risks.
Andrew Bailey, the Bank’s Governor, spoke last year of his desire as the economy emerged from the pandemic that the MPC would be able to keep control and not be driven by events. It was on track to achieve that goal with consecutive hikes. However, the conflict has blown that desire off course.
Inflation is still well above target and is expected to rise further, the economy is slowing, and the population faces further pressure on household budgets driven by two major negative factors due to take effect next month.
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Beyond Currency Market Commentary:
Aims to provide deep insights into the political and economic events worldwide that can cause currencies to change and how this can affect your FX Exposure.
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Beyond CurrencyBy CurrencyTransfer

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