David Ramsden: Navigating an uncertain outlook - the signals from the labour market

Speech by Sir David Ramsden, Deputy Governor for Markets and Banking of the Bank of England, at the Barclays-Centre for Economic Policy Research (CEPR) International Monetary Policy Forum 2025, London, 24 June 2025.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Thank you for inviting me to speak at the Barclays-CEPR Monetary Policy Forum, which gives me the opportunity to set out my latest thinking, in the light of last week's decision by the Monetary Policy Committee (MPC). The MPC decided by a majority of 6-3 to leave Bank Rate unchanged at 4.25%, and I was one of the three members who preferred to cut Bank Rate by 25bps.

Over the last eight meetings, a year in MPC terms, we have gradually eased policy restrictiveness in the UK, cutting Bank Rate four times, reflecting the progress made in the disinflation process to bring inflation back towards the 2% target sustainably in the medium term.

The persistence of domestic inflationary pressures has been our key focus and we have taken a gradual approach to reducing policy restraint to ensure persistent inflationary pressures in domestic wage and price-setting are squeezed out so that inflation returns sustainably to the 2% target. Since the start of this year we have stressed that we are taking a 'gradual and careful' approach in light of the increasingly uncertain global and domestic environment, which is leading to two-sided risks to the outlook for inflation.