BoE Governor Bailey (Q&A), asked what he will be watching in the weeks ahead, says first-round effects (energy prices), indirect effects that impact costs of production, then second-round effects

Governor Bailey's comments on the importance of both first-round and second-round effects of energy prices suggest a heightened awareness of inflation dynamics at the Bank of England. This signals a possible hawkish bias, as the focus on production costs indicates a cautious approach to rate decisions. Watch for potential shifts in market expectations regarding future rate hikes based on these insights, especially concerning GBP and fixed income assets.