- Sees risks from higher natural gas prices with a tight labor market, adverse labor supply developments and goods market bottlenecks
- Domestic factors will strongly influence my monetary policy decisions in the coming months
- If imported gas prices remain significantly higher than in the past, then the threat of second-round inflation effects remain
- The persistent component of inflation is the relevant object for the MPC's attention
- Supply disruptions appear to have eased in recent months
- We are starting to see labor market indicators turn
This is hawkish stuff. The next decision is Feb 2 and the consensus is a 69% chance of a 50 bps hike with the remainder at 25 bps.
Cable is at the highs of the day at 1.2205, though much of that is broad USD weakness.
