BoE’s Pill sees no victory over inflation yet, but recession coming

LONDON (Reuters) – Bank of England Chief Economist Huw Pill said on Tuesday the British central bank could not consider the threats posed by inflation to be under control but the British economy was going into a recession, complicating the outlook for the BoE.

“I think we cannot declare victory against second-round effects, but we are entering a recession,” Pill said at a conference organised by bank UBS. “That’s a difficult trade-off environment for monetary policy.”

Pill said the BoE’s message to markets last week that they were pricing in too many interest rate increases in the future was an attempt to give a more realistic view of where Bank Rate was heading, although borrowing costs did need to rise further.

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