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BOE's Dhingra: Winter Energy Situation Will Determine Inflation Risk
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Bank of England Monetary Policy Committee member Swati Dhingra stated on Thursday that the extent of long-term inflationary pressure on the UK from the Iran war will become clearer over the coming winter months. Dhingra noted that the UK is not currently experiencing the broad price increases seen in 2022 following the Russia-Ukraine war, and the labor market is weaker now. She identified the winter energy situation, wage negotiations, and ongoing financial tightening as key factors to monitor. Dhingra indicated that signals on wage talks and other medium-term inflation drivers should become clearer by the end of 2026. She also pushed back against the view that raising interest rates early is crucial for maintaining the Bank of England's anti-inflation credibility.
Source report
September 24 — The extent of long-term inflationary pressure on the UK from the Iran war will become clearer over the coming winter months, according to Bank of England Monetary Policy Committee member Swati Dhingra.
Speaking on Thursday, Dhingra noted that the UK is not currently experiencing the broad-based price increases seen in 2022, when the Russia-Ukraine war drove energy prices sharply higher and triggered widespread inflationary pressure across the country.
She also highlighted that the UK labour market is currently weaker than it was during that period.
"The key moment is that we will see how things develop through the winter energy situation," Dhingra said. "We will have a clearer picture of wage negotiations and their outcomes, and financial tightening is already underway."
Signals regarding wage negotiations and other medium-term inflation drivers should become progressively clearer by the end of 2026, she added.
Dhingra also pushed back against the view that raising interest rates early is critical to maintaining the Bank of England's credibility in fighting inflation.
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金十数据Neutral / independent
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BoE's Dhingra: UK inflation outlook hinges on winter energy, no need for panic