• But it is encouraging that inflation will be close to target in the coming months
• Higher than expected wage and services inflation since February should give us pause for thought
• But we should not overinterpret it, they are well within the normal margins of variance
• Change in bank rate in June is neither ruled out nor a fait accompli
• Inflation persistence outlook is similar to February
• More data will help to assess outlook on CPI inflation
• We are making very good progress in returning inflation to 2% target
• Restrictive monetary policy stance is working
• It is likely we will need to cut bank rate over the coming quarters
• It is also possible to cut more than what is currently priced into market rates
• We have no preconceptions on how far or how fast we will cut rates

It is interesting that he wants to try to keep June on the table. There will be two CPI reports prior to the meeting on 20 June, but the last one will only leave them with a day to think things over. I doubt we’ll see that much progress to warrant a majority vote for a rate cut by then.

GBP/USD slowly pared losses to around 1.2480 before Bailey mentioned that they might cut more than what markets are pricing in. That is sending the pair down to 1.2455 again.

This article was written by Justin Low at www.forexlive.com.