Overview
- Speaking in Jackson Hole, the governor said the Bank is prioritising labour-force participation over unemployment in assessing the outlook.
- He cited rising long-term sickness and a sharp fall in young people in work, with mental health now the most common reason for inactivity.
- The Bank recently lowered its estimate of the UK’s potential growth rate to just above 1% and linked weak supply to persistent inflation.
- Policymakers cut the policy rate to 4% this summer but maintained warnings about inflation risks.
- Official figures show GDP grew 0.3% in the second quarter of 2025, while participation remains below pre-pandemic levels.