Pill Warns of Gradual Build-up of Inflation Pressures in Britain

Bank of England Chief Economist Huw Pill has expressed concerns about a potential slow build-up of inflation pressures in Britain's economy. The risk is linked to the recent jump in energy prices, which was caused by the Iran conflict.

Pill spoke out after voting against a rate hike in the 6-3 decision by the BoE's Monetary Policy Committee to keep interest rates at 3.75%. He emphasized that he did not expect a sharp increase in inflation expectations, saying 'We haven't seen evidence of that, and I think that is good news.'

However, Pill warned about potential second-round effects that could be more insidious due to the gradual nature of these changes. It's still early days for assessing the full impact of the conflict on inflation.