Bank of England Chief Economist Huw Pill expressed concerns on Tuesday about the speed of recent interest rate cuts, suggesting that the quarterly pace of reductions since mid-2024 has been too rapid given the current inflation outlook. Speaking at Barclays in London, Pill clarified his vote last week to keep borrowing costs on hold was likely a “skip” rather than a complete halt to monetary tightening.
Pill emphasized that his May vote favored a temporary pause within an ongoing process of withdrawing monetary policy restrictions, rather than stopping or reversing the tightening cycle. “It should not be seen as favouring a halt to — still less a reversal — of that withdrawal of restriction,” he noted.
This cautionary stance highlights ongoing concerns within the Bank of England regarding persistent price pressures and rising inflation expectations. Pill’s comments come amid other signals from the BoE that inflation remains a key challenge, underscoring the need for careful policy calibration to avoid stoking further inflation while supporting economic growth.
As markets and policymakers digest these remarks, the future trajectory of interest rates in the UK remains a closely watched issue, balancing inflation control with the risks of economic slowdown.
