13 May 2015
Pound strength lowers import prices – BOE’s Carney
FXStreet (Mumbai) - The Bank of England (BOE) governor Mark Carney, in his press conference on Wednesday attributed the drop in the lower import prices to the strength in the British Pound.
Carney said the low productivity problem is likely to remain in place, with productivity likely to remain below past growth rates. On bond markets, the governor said he is not particularly surprised by the recent surge in volatility, while stating that is unclear why the Gilt yield curve flattened beyond three year horizon.
On inflation, he said, there are one-off factors driving the inflation lower. He added further that the CPI is likely to fall below zero in coming months. On rate hikes, Carney once again reiterated that the next move at the BOE is more likely to be a rate hike.
Carney said the low productivity problem is likely to remain in place, with productivity likely to remain below past growth rates. On bond markets, the governor said he is not particularly surprised by the recent surge in volatility, while stating that is unclear why the Gilt yield curve flattened beyond three year horizon.
On inflation, he said, there are one-off factors driving the inflation lower. He added further that the CPI is likely to fall below zero in coming months. On rate hikes, Carney once again reiterated that the next move at the BOE is more likely to be a rate hike.