Bank of England (BoE) Deputy Governor Dave Ramsden warned that risks to the inflation outlook have become increasingly tilted to the upside, citing external pressures such as energy prices, weather, and Artificial Intelligence (AI) supply chains, as well as domestic risks from food prices and potential second-round effects [1]. Ramsden stated that if these upside inflation pressures continue to build, there could be a case for raising the bank rate, reinforcing expectations that the BoE may need to keep policy tight or even consider renewed rate hikes [1].
Ramsden emphasized that he does not expect the central bank to consider further Quantitative Easing (QE) in the near future [1]. His comments were scored 8.4/10 on the FXS Speechtracker, notably above the historic 7.1/10 baseline, indicating a stronger-than-usual policy impact and a clear hawkish tilt [1].
Despite the hawkish tone, the British Pound (GBP) showed no significant immediate reaction to Ramsden’s comments. GBP/USD remained higher, gaining 0.21% on Monday to trade around 1.3250 at the time of writing [1]. Market participants are reassessing the probability of renewed rate hikes or a prolonged high-rate stance, which is generally supportive for GBP, especially against the Euro and Dollar [1].
CONCLUSION
BoE Deputy Governor Ramsden’s remarks highlight a growing concern over upside inflation risks and suggest the possibility of future rate hikes if pressures persist. While the market reaction was muted, the hawkish stance is likely to keep expectations for tighter monetary policy elevated, supporting the British Pound in the near term.