The labour market is rebalancing and inflation is on a “benign” path, a Bank of England official has said, boosting hopes that interest rates could come down next month.
Megan Greene, an external member of the Bank’s ratesetting monetary policy committee, said that the supply of and demand for workers was better aligned, having been out of balance for the past two years. She said that this would constrain pay growth and would suppress inflation, which has fallen to 3.2 per cent, the lowest level since September 2021.
“As vacancies have fallen back close to pre-pandemic levels, labour demand and labour supply are finally roughly equal,” Greene told an audience at Make UK, the manufacturers’ organisation. “This should mean there is less upward pressure
