""a further journey down""
""It will depend on the path of inflation going down,""
""People are being quite cautious at the moment. Of course, that affects spending ... People aren't going out as much; they're not shopping as much; they're not going out to restaurants and so on as much,""
Sterling fell 0.7% against the dollar to $1.34 after the Bank of England governor suggested interest rates could be cut if inflation eases. He indicated a "further journey down" for borrowing costs might be possible and said cuts would hinge on the path of inflation. Weak consumer demand is weighing on the recovery, with retail sales 2.1% below pre-pandemic levels and GDP flatlining in July. Inflation has remained at 3.8% in July and August and the Bank expects a 4% peak in September. Markets largely expect rates to be held at 4% for the rest of the year, while gilt yields and sterling-euro moves showed limited reaction.
Read at Business Matters
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