Published by Global Banking & Finance Review®
Posted on November 7, 2025
2 min readLast updated: January 21, 2026
Add as preferred source on GoogleBoE's Huw Pill advises not to over-interpret changes in rate cut language, highlighting a balanced approach to future decisions.
By David Milliken
LONDON (Reuters) -Bank of England Chief Economist Huw Pill said not too much should be read into a shift in language in November's Monetary Policy Report and that the central bank's rate decisions were finely balanced.
On Thursday, the BoE's main summary of its monetary policy decision no longer included the words "and careful" alongside "gradual" when it said that its Bank Rate "is likely to continue on a gradual downward path".
Asked about this at a briefing for businesses on Friday, Pill said: "I would caution a little against over-interpreting these linguistic changes."
"Perhaps in some circles, 'gradual and careful' had become associated with a certain pace and magnitude of Bank Rate reduction and I think it's probably fair to say that the committee as a whole never really endorsed that," he added.
Pill was part of the 5-4 majority that voted to keep Bank Rate unchanged at 4% on Thursday. Before Thursday's decision to keep rates on hold, the BoE had cut interest rates every three months since the start of its cutting cycle in August 2024.
Previously, Pill had made the case for a slower or "cautious" approach to rate cuts.
Pill said BoE policymakers were divided between one group, who viewed slower business activity and falling employment as likely to push inflation below target over the medium term, and another which was more concerned that inflation and wage growth had not yet slowed that much despite a weaker economy.
"If you look at the vote which was a 5-4 vote on this occasion to hold Bank Rate, I think that says that the balancing of those to risks is quite finely balanced at the moment," he said.
Financial markets price in a roughly 60% chance of a quarter-point rate cut on December 18 after the BoE's next meeting.
(Reporting by David Milliken; Editing by Alistair Smout)
Monetary policy refers to the actions taken by a central bank to manage the money supply and interest rates to achieve macroeconomic objectives such as controlling inflation, consumption, growth, and liquidity.
Interest rates are the cost of borrowing money, expressed as a percentage of the total amount borrowed. They are set by central banks and can influence economic activity and inflation.
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power. Central banks attempt to limit inflation to keep the economy running smoothly.
The Bank Rate is the interest rate at which a central bank lends money to commercial banks. It influences the rates banks charge consumers and businesses for loans.
Financial markets are platforms where buyers and sellers engage in trading financial assets such as stocks, bonds, currencies, and derivatives. They facilitate price discovery and liquidity.
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