Bank of England Governor Andrew Bailey said on Tuesday that the central bank remained in no rush to respond to increased oil prices and that inflation was on course to return to its 2% target, albeit later than he would have liked.
Bailey said that past increases in oil prices meant British inflation looked likely to rise to around 3.2% later this year, but the cost of oil now was not much higher than before the Iran war broke out at the end of February.
"We've had some tightening built into the (bond yield) curve, which gives us some time then to judge the pass-through (of higher energy prices)," he said in an interview with CNBC in Sintra, Portugal, where he is attending a conference hosted by the European Central Bank.