MNI BRIEF: Rate Peak Much Near, Flat-for-Long In Focus- Bailey

Bank of England Governor Andrew Bailey put an imminent rate peak back in the policy debate in comments to lawmakers Wednesday, with the Monetary Policy Committee facing a key question over whether to hold rates steady-for-long or to go a bit higher and then subsequently cut them.

The BOE head, speaking to the Treasury Select Committee, stressed that while he was not pre-judging the outcome of the MPC's meeting this month the judgement on whether to hike had become much more finely balanced. "I think we are much nearer now to the top of the cycle," Bailey said.

His MPC colleague, Swati Dhingra, made clear her preference for keeping the policy rate steady for long rather than pushing it up further and cutting and Bailey said that was an important choice that the MPC faced. He noted, however, that the average difference over three years between the current market implied rate path, for Bank Rate to rise to 5.75% from the current 5.25% and then fall back, and holding Bank Rate flat was only around 25 basis points.