BoE’s Dhingra: Wages are responding to inflation with a lag

Bank of England (BoE) policymaker Swati Dhingra said on Tuesday, “wages are responding to inflation with a lag.”

Additional quotes

The external shock has not totally worn off.

Core inflation on its own is not a particularly good measure of domestically generated inflation.

Medium-term economic forecasts aren't good at picking up turning points.

We don't have data to immediately rule in or rule out greedflation at this stage.

Sharp decline in PPI is promising.

Broadly there is co-movement of producer prices and CPI, but it is not as tight as we would like.

Not very convincing to argue as yet that the UK grocery inflation is driven by 'greedflation'.

There are some promising signals that uk cpi should ease, based on big fall in producer price inflation.

Market reaction

At the time of writing, GBP/USD is unfazed by the above comments, keeping its range at around 1.2735, up 0.15% on the day.