Meghan Green, the policy official at the Bank of England, stated that U.S. President Donald Trump's tariffs are likely to lead to a decrease in inflation in Britain rather than an increase. However, there are still significant doubts about the plan and the impact of the recent tax increase in the United Kingdom on employers.
Green added in a discussion with the Atlantic Council think tank on the sidelines of the International Monetary Fund's spring meeting: "We have tariffs, and none of us knows what they will look like when things settle down."
She explained: "I think the realm of risks has changed a bit, so I think the risks now lean towards price contraction, so I believe that tariffs on the United Kingdom will ultimately be more deflationary than inflationary."
When asked what she expects ahead of the Bank of England's meeting on interest rates next month, Green said she is concerned about weak productivity growth in Britain and supply-side constraints on the economy.
She added: "There is also a lot of uncertainty regarding the budget's effects on the economy, especially the rising labor costs."
Since his inauguration on January 20, he has begun to clash with most countries around the world by threatening to impose tariffs on all imports to America from countries that impose tariffs on Washington's exports.
Trump made a promise and kept it, starting with China, his arch-nemesis, and then disregarding all countries with various tariffs. However, he later suspended their implementation on April 9, except for the tariffs on Beijing, which continue to this day.
Several statements have come out from the White House more than once, indicating that a serious discussion is ongoing with Beijing regarding tariffs. Amidst Beijing's denial of these statements, China has begun to ease its 125 percent tariffs on certain U.S. imports such as medicines and aircraft parts.
