By Paul Hannon
The Bank of England could cut its key interest rate over the coming months if wage growth and the rise in services prices show signs of cooling as forecast, Deputy Governor Ben Broadbent said Monday.
The U.K.'s central bank left its key interest rate at a 16-year high earlier this month, but signaled that it is getting closer to a cut. Two of the Monetary Policy Committee's nine members voted for a rate cut, but Broadbent sided with the majority.
"If things continue to evolve with [MPC's] forecasts - forecasts that suggest policy will have to become less restrictive at some point - then it's possible Bank Rate could be cut some time over the summer," Broadbent said in a speech.
Broadbent will step down after the June meeting of the MPC. The MPC's first meeting without him will take place in early August.
Broadbent said that reports from the BOE's network of agents dotted around the U.K. suggest that wage growth will stay strong this year. But he said those agents also report that businesses are less confident that they can pass on those higher wage costs to consumers through higher prices.
Write to Paul Hannon at paul.hannon@wsj.com
(END) Dow Jones Newswires
05-20-24 0539ET
