The Bank of England's Monetary Policy Committee member Swathi Dhingra said in an interview with the Financial Times that she is concerned that policymakers might be underplaying the downside risks. She also noted that she is not fully convinced of sharp excess demand in the economy from the consumption side. Dhingra warned that the real economy might start getting negatively hit more profoundly. "I don’t see why we should be risking that," the official added.
In addition, the policymaker noted that inflation had demonstrated a pretty consistent drop, which, in her view, had not been just energy-driven but much more broad-based. At the same time, the UK economy has not witnessed a wage-price spiral that would threaten the BoE’s ability to bring inflation back to its target, she added.
Dhingra also admitted that given lags in the transmission of the monetary policy, the BoE is still looking at a pretty restrictive period of monetary policy even if it cuts rates now.