BoE Policymaker Greene: Central Bank Should Not Ignore Successive Negative Supply Shocks

According to Bank of England policymaker Swati Dhawan (Greene), speaking Monday at a Financial Times event, the central bank should not assume the inflationary impact of geopolitical tensions will be temporary. Greene highlighted that the UK has experienced three negative supply shocks within five years and emphasized the need to monitor wage and price formation mechanisms. “Traditionally, you would overlook negative supply shocks, but when facing successive shocks, that approach is outdated,” she stated. Greene voted to hold interest rates steady in April but suggested rate increases may be necessary at upcoming monetary policy meetings.