MNI BRIEF: BOE Mann Sees Little Room For Further Rate Cuts
MNI (LONDON) - Bank of England Monetary Policy Committee member Catherine Mann said Tuesday that while she supported a 50bp cut at the February MPC meeting, when the majority backed a 25bps move taking the rate to 4.5%, she wanted to maintain policy restrictiveness in future and made clear Bank Rate did not have far to fall in her view.
She said her support for a larger cut reflected in part a desire to 'cut through the noise' and to look through the looming move higher in inflation and to offset tightness in UK financial conditions which had been driven largely by events in the US. She said she did not favour a prolonged series of cuts.
Mann noted that market rate expectations for Bank Rate in the longer run were in a 3 to 3.5% range and she said "I’m more likely at the higher end of that range,' which would entail that the policy rate can only go down a modest amount if it is to remain restrictive. She stressed that her concerns about upside inflation risks remained.