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“The data we have so far suggest that the drop in aggregate spending already taking place will be extremely large,” Bank of England (BoE) policymaker Silvana Tenreyro said on Thursday.

Key takeaways

“COVID-19 shock likely to highly varied across sectors.”

“We will continue to set policy in order to achieve price stability and anchored inflation expectations.”

“We want to minimise damage from COVID-19 to supply sector of the economy.”

“Current policy actions will help counterbalance some of the underlying weakness in inflation.”

“Inflation data will be hard to interpret.”

“COVID-19 19 may strengthen existing trends towards weak unit wage cost growth in consumer sectors and weak input cost inflation.”

“The reality is that both supply and demand are likely to fall sharply in affected sectors.”

“Some shoppers may permanently switch to online shopping after COVID-19.”

“Switch to online working could depress commercial rents.”

“International travel may not recover after COVID-19.”

“The rise in universal credit claims suggests a very sharp reduction in employment.”

Market reaction

The GBP/USD pair largely ignored these comments and continues to trade with modest losses near the 1.2500 handle.