BOE’s Broadbent Declines to Say If a Rate Rise Will Be Needed

BOE’s Broadbent Declines to Say If a Rate Rise Will Be Needed
© Bloomberg. Ben Broadbent, deputy governor for monetary policy at the Bank of England (BOE), during the Monetary Policy Report news conference at the bank\’s headquarters in the City of London, U.K., on Thursday, Nov. 4, 2021. The Bank of England will decide Thursday whether to deliver its first interest rate hike since the pandemic as a divided Monetary Policy Committee grapples with spiking inflation and slowing growth. Photographer: Chris Ratcliffe/Bloomberg

(Bloomberg) —

Bank of England Deputy Governor Ben Broadbent broke from the guidance that policy makers set down in November, declining to say that interest rates will need to rise in the coming months to control inflation.

The remarks in a response to questions after a speech raised more doubts about the U.K. central bank’s preparations to tighten monetary policy. He noted that the omicron variant of the coronavirus is another surprise that will take time to assess, and that much of the current upward pressure on inflation will be “transitory.”

A question about “what are you going to do to interest rates is simply not answerable,” Broadbent said Monday when asked whether he still though rates would need to rise. He said he wouldn’t decide on rates until the BOE has its next policy meeting on Dec. 16.

  • On omicron, he said, “It’s slightly less unprecedented than it was 18 months ago. Some of the economic effects will depend on the accompanying policies. This whole experience is certainly less disinflationary so far than central banks and any other forecasts expected back in the spring of 2020.”
  • READ MORE: BOE’s Broadbent Says ‘Transitory’ Inflation May Pass 5% in 2022



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