A Bank of England official said Friday that he thought it “quite likely that additional monetary stimulus will be appropriate” in order for the British central bank to reach its official 2% annual inflation target.
Michael Saunders, a member of the BoE’s rate-setting Monetary Policy Committee, said in a speech that the current state of the labor market was “very worrying,” and added that the economy might underperform the already dire forecast of the central bank from last month.
He also warned about the risks that Brexit represent for the UK economy, with the prospects of a “thinner trade deal, a less-smooth transition or more persistent Brexit-related uncertainty.”
The BoE’s key rate stands at 0.1%, a record low, and the central bank has launched a £300 billion ($395 billion) asset-buying programme to help the economy weather the consequences of the coronavirus pandemic.
The BoE’s Monetary Policy Committee is scheduled to meet next on September 17.