MNI BRIEF:BOE MPC Members Agree Rate Path Down, Split On Speed

Bank of England Monetary Policy Committee members giving evidence to the Treasury Select Committee all agreed that the policy rate was heading downwards but, as Governor Andrew Bailey said, there were differences among them with splits over the speed and scale of cuts.

The most dovish MPC member, Swati Dhingra, who backed a 50 basis point cut in May when the majority supported 25 bps, said policy has long been too tight and that she now had to start thinking about whether to increase the scale of cuts she had been voting for. Catherine Mann, who opposed the May cut, said she agreed "that the direction is down" but the speed and scale of cuts was unknown.

Differences were also clear between Governor Andrew Bailey, who said he would have been uncertain about voting for a cut in May had in not been for adverse global developments and one of his deputy governors, Sarah Breeden, who said "had the international developments not occurred, I would probably have voted to cut rates anyway". Bailey highlighted the uncertainty over the inflation outook, saying one genuine concern was that disruption of global supply chains, sparked by US trade policy, could result in upward inflationary pressure.