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11/26/2021, 2:23 PM (Source: TeleTrader)
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BoE's Pill: Labor market to keep tightening

Bank of England's (BoE) Chief Economist Huw Pill said on Friday that the end of the furlough scheme in the United Kingdom has not led to a substantial spike in unemployment with "most recent indicators point to a further tightening of the labor market." He predicted the high level of vacancies and supply bottlenecks will therefore persist and stated that, if the jobs market continues to be strong, interest rates "will need to gradually increase in the coming months, to make sure inflation comes back down from current high levels."

On the rise in energy prices, Pill said that "even if uncertainty around their future evolution is substantial, I don’t see reasons to expect continued rises in energy prices, at least not at anything near their recent pace. As a result - and as long as any second-round effects are contained by the credible anchoring of medium-term inflation expectations at target - the impact of energy prices on inflation will prove temporary."

Baha Breaking the News (BBN) / DJ