BOE's Bailey on May rate decision: The situation is very volatile

"We have been very cautious on forward guidance language because things are so uncertain," Bank of England Governor Andrew Bailey said on Monday, as reported by Reuters. When asked about May rate decision, Bailey noted that the situation was very volatile.

Additional takeaways

"Will take time before we really come to a proper assessment of how the joint experience of COVID and Ukraine invasion causes world economy to emerge into new steady state."

"We are at an even more challenging point for global economy than after the global financial crisis."

"We must as policymakers say we do not want to see the breakdown of the open world economy."

"Trade-off situations are much harder to deal with for monetary policymakers."

"We are not facing market conditions similar to March 2020."

"Clearly commodities are the area of greatest volatility and has a connection to monetary policy."

"We have to be very alert to the risk of interaction between the real economy and financial market impact from commodities."

"Impact of real income shock is yet to materialise."

Market reaction

GBP/USD continues to edge lower during the European session and was last seen losing 0.4% on the day at 1.3135.