MNI BRIEF: BOE Bailey: Saw Case In Nov For Delaying Hike

Bank of England Governor Andrew Bailey said that for him a key question at the November Monetary Policy Committee meeting was whether to hike then or to wait at least until the December meeting in order to see more data on the labour market and the impact of the end of the jobs furlough scheme. Bailey, speaking to the Treasury Select Committee, make clear that a December hike, following the surprise decision to leave policy on hold in November, is very much in play.

The question was "Do we wait for at least for six weeks or do we act now?" Bailey said, adding that it was "very finely balanced." He said that for him the key issue was whether transitory price pressures would feed through to wage inflation and higher medium-term inflation expectations.

MPC member Catherine Mann countered Bailey's point, however, saying that firms may not be able pass on price pressures as consumers' disposable income came under pressure because of rising food and energy prices, highlighting the divisions on the MPC.