LONDON (Reuters) – Britain has a long way to go for inflation pressures to be consistent with the Bank of England’s 2% target, one of the central bank’s policymakers, Catherine Mann, said on Monday.
“We have a long way to go on both of them (services and goods inflation),” she told an event organised by hedge fund Citadel, consultancy CEPR and the International Center for Monetary and Banking Studies.
“We’re nowhere near the historical relationship between services and goods that is consistent with headline at 2(%).”
She was one of two members of the BoE’s Monetary Policy Committee who voted last month to raise interest rates – which are currently their highest since 2008 – to see off inflation risks.
Mann also said she wanted to stress “just how important the deterioration in the supply side is for the UK.” The BoE is worried that Britain’s tight labour market will generate long-running inflation pressures in the economy.
(Reporting by William Schomberg; writing by Muvija M)