That’s the kind of comment that’s a pushback on pricing for 50 bps of hikes in the next year despite a weak economy. Those risks won’t really materialize though until the war is over and oil prices begin to fall. If/when that happens, then the BOE will be getting help on inflation from energy.
What Bailey doesn’t say is that oil prices were falling before the war in Iran. That itself was a drag on inflation and they never got it down despite that. Now you can blame tariffs and whatever else but there was a positive state of play and simply unwinding that would have gotten oil back to $75 or so.
With that, it’s a facetious premise to only blame the war in Iran.
