Bank of England chief economist Huw Pill said a near-term bank rate increase would reduce the likelihood the Bank must adopt more aggressive tightening to curb inflation pressures from the Iran war. He said a timely, well-communicated rate rise does not necessarily signal the start of a prolonged, aggressive hiking cycle and can prevent harmful "catch-up" nominal dynamics that would make temporary inflation overshoots more persistent. Pill and two other MPC members voted to hike in July. Rate fu

Bank of England chief economist Huw Pill said a near-term bank rate increase would reduce the likelihood the Bank must adopt more aggressive tightening to curb inflation pressures from the Iran war. He said a timely, well-communicated rate rise does not necessarily signal the start of a prolonged, aggressive hiking cycle and can prevent harmful "catch-up" nominal dynamics that would make temporary inflation overshoots more persistent. Pill and two other MPC members voted to hike in July. Rate futures put the probability of a 25bp move at this month’s MPC slightly above 15%, while the November meeting is priced for a hike at more than 70%.