Bank of England could make cuts to interest rates if jobs market slows down, Bailey says
Interest rate cuts could be coming, signals Bank of England governor
- Bank of England Governor Andrew Bailey has indicated that interest rates could be cut if the job market weakens.
- Mr Bailey said that businesses are "adjusting employment" and offering lower pay rises due to Chancellor Rachel Reeves' increase in national insurance contributions for employers.
- He believes the British economy is growing below its potential, which could create "slack" to reduce inflation.
- The Governor expressed confidence that the Bank's base rate, currently 4.25 per cent, is on a "downward" path, with the next review scheduled for 7 August.
- The government is under pressure to improve living standards, with some Labour figures suggesting a wealth tax, although other tax rises at the autumn budget have not been ruled out.