BoE Governor Bailey says Fed Chair Warsh is "right to see some dangers in forward guidance"

Cross-central-bank commentary on policy framework is less common than comment on data, and historically marks the early stages of a doctrinal shift rather than a near-term policy change. Forward guidance has been contested since its post-crisis adoption: critics argue unconditional commitments have a track record of constraining central banks when inflation surprises, forcing either a credibility-damaging reversal or a delayed response, and episodes of that kind have tended to end with guidance being qualified or dropped. Bailey engaging with the Fed chair's scepticism on the same day carries more weight than a solo speech; when senior officials across major central banks echo each other on framework, it has generally preceded formal language changes in statements and minutes. The operative line is the insistence that inflation must return to target even at variable speed, which signals the reaction function is data-conditional and time-inconsistent promises are off the table. The distinction that matters for pricing is between abandoning calendar-based guidance, which steepens the distribution of rate outcomes at the front end, and abandoning outcome-based guidance, which changes how markets map data to the path. Worth watching are the next policy statements and any speeches from other officials adopting the same vocabulary, plus the scheduled framework reviews where such critiques get formalised.