Bank of England Policymaker Urges Pause on Rate Decision Amid Iran War Risk
A member of the Bank of England's Monetary Policy Committee suggested holding off on a rate cut at the next meeting because of uncertainty from the Iran war. The remarks cited volatility in energy prices.
A member of the Bank of England's Monetary Policy Committee told Investing.com that policymakers should hold off on a rate cut at the next meeting because of uncertainty from the Iran conflict. The member said volatility in energy prices risks feeding directly into headline inflation.
UK headline CPI stands at 3.1% on the latest reading, against the bank's 2% target. Brent crude near $105 a barrel keeps fuel and gas-bill pass-through in focus. Markets had been pricing a strong probability of a 25 basis-point cut at the June MPC meeting.
The gilt market reacted within minutes. The 10-year UK gilt yield rose by 5 basis points to 4.52%. Sterling traded in a narrow range against the dollar. Analysts say long-dated gilt yields may stay elevated given Treasury fiscal commentary and political pressure on the Starmer government.
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