Bank of England's Tenreyro: Small amount of policy tightening will probably be needed

The Bank of England probably has more time than it previously thought before it will need to raise interest rates, assuming Britain can leave the European Union with a transition deal, BoE interest-rate setter Silvana Tenreyro said on Wednesday. Tenreyro says a small amount of policy tightening will probably be needed over forecast period in a smooth Brexit scenario.

Additional comments from Tenreyro:

• Says if Brexit deal reached, stronger pound would ease inflation pressure, especially given prospect of looser policy abroad;
• Says weaker global outlook would also lengthen period until there is enough inflation pressure for her to vote for rate hike;
• Says she does not expect such an inflation pressure pickup in the next few months;
• Says more likely than not that no-deal Brexit response would be monetary policy loosening but this is by no means certain;
• Says increases in trade tensions have added downside risks for global economy;
• Says UK core inflation measures stable, few signs of weakness in inflation expectations;
• Says UK labour market remains tight: employment, hours worked and unit labour costs growth have been strong.