BOE's Mann Says Labor Market Too Static to Curb Inflation, Warns Price Pressures Embedded

Bank of England rate-setter Catherine Mann said on October 6, 2026, that the UK labor market is "static" rather than loose, warning inflation is becoming embedded and delaying rate hikes would make the job of restoring price stability harder. Speaking at a TS Lombard event in London, Mann said she is concerned about upcoming wage settlements as the BOE expects rising fuel and energy costs to push inflation "notably" above 4% early next year. She described the UK as a "low-hire, low-fire environment," arguing new labor market entrants provide insufficient slack. Mann, among the most hawkish Monetary Policy Committee members, backed an immediate rate rise last month and cited second-round effects as firms pass on costs and workers bid up wages amid high inflation and Ofgem energy price increases. She flagged a possible large minimum wage rise as a further risk. She said there is an "upward bias" to UK inflation, adding policymakers can "pivot" if price growth proves more benign than feared.