{"id":158717,"date":"2025-09-25T02:44:15","date_gmt":"2025-09-25T02:44:15","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/158717\/"},"modified":"2025-09-25T02:44:15","modified_gmt":"2025-09-25T02:44:15","slug":"pound-slumps-after-bank-of-england-boss-andrew-bailey-hints-at-further-rate-cuts-as-families-cut-spending","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/158717\/","title":{"rendered":"Pound slumps after Bank of England boss Andrew Bailey hints at further rate cuts as families cut spending"},"content":{"rendered":"

By JOHN-PAUL FORD ROJAS, DEPUTY BUSINESS EDITOR<\/a> <\/a> <\/p>\n

Updated: 17:00 EDT, 24 September 2025 <\/p>\n

The Governor of the Bank of England yesterday said \u2018cautious\u2019 consumers were holding back on spending as he hinted at further interest rate cuts \u2013 sending the pound lower against the dollar.<\/p>\n

Andrew Bailey told West Midlands Life that there was still a \u2018further journey down\u2019 for rates \u2013 as long as inflation<\/a> cools.<\/p>\n

Sterling fell by as much as a cent against the dollar to just above $1.34 \u2013 a three-week low.<\/p>\n

Bailey said: \u2018People are being quite cautious. That affects spending so that has an effect on the state of the economy.<\/p>\n

\u2018People aren\u2019t going out as much, they\u2019re not shopping as much, they\u2019re not going out to restaurants as much and so on.\u2019<\/p>\n

The Bank faces stubborn inflation \u2013 currently 3.8 per cent \u2013 and signs of a struggling economy and weakening jobs market.<\/p>\n

\"Tentative: <\/p>\n

Tentative: Bank of England governor Andrew Bailey (Ipictured) told an interviewer for West Midlands Life that there was still a \u2018further journey down\u2019 for rates – as long as inflation cools<\/p>\n

Cutting rates could boost the economy but leaving them higher may be necessary to try to tackle inflation.\u00a0<\/p>\n

Markets expect rates to stay at 4 per cent until next year.<\/p>\n

Bailey said: \u2018We have to balance all these things because we want to bring inflation back to target, but obviously want to do that within an economy that has some sustained activity in it.\u2019<\/p>\n

And he made clear that much of the blame for the rise in food prices – which is driving inflation – could be blamed on government decisions to hike employer national insurance and the minimum wage.<\/p>\n

\u2018Labour costs have gone up in the food industry. It has been affected by the national insurance increase, it is affected by the living wage,\u2019 Bailey said.<\/p>\n

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\n Pound slumps after Bank of England boss Andrew Bailey hints at further rate cuts as families cut spending<\/p>\n