Bank of England could cut the base rate if one thing happens

The Bank of England governor Andrew Bailey has said there could be a cut in interest rates if the jobs market slows.

Amid the Chancellor’s decision in “adjusting employment” for businesses in raising employers National Insurance Contributions (NICs), Baily told The Times.

Bailey said that businesses are “having pay rises that are possibly less than they would have been if the NICs change hadn’t happened.”

During the interview Bailey said this could trigger “slack” which will help to bring down inflation, this in turn will see the prices on goods will rise more slowly.

The Bank of England governor told The Times, “I really do believe the path is downward.

He added, “But we continue to use the words ‘gradual and careful’ because… some people say to me ‘why are you cutting when inflation’s above target?’”

Speaking to Times Radio the Treasury chief secretary Darren Jones said, “We’ve also seen the creation of hundreds of thousands of new jobs across the country, and it’s normal for business to make adjustments to their plans, depending on the cost of business, in the normal way.

“But we’re really focused as a Government in supporting business to create more jobs.”