If the job market slows, the bank's boss is ready to cut rates.

 

If the job market shows signs of slowing down, the Bank of England's governor has stated that the central bank is prepared to cut interest rates even further. In an interview with the Times, Andrew Bailey said "I really do believe the path is downward" on interest rates.

 Interest rates currently stand at 4.25% and will be reviewed at the Bank's next meeting on 7 August, when many economists expect the rate will be cut.

 They affect mortgage, credit card and savings rates for millions of people.

 Speaking to the Times, Mr Bailey said: "I think the path [for interest rates] is down.

 "But we continue to use the words 'gradual and careful' because... some people say to me 'why are you cutting when inflation's above target?"'

 He said the UK's economy was growing behind its potential, opening up "slack" that would help to bring down ­inflation.

 Slack refers to the amount of unused resources in an economy, such as working factories which are not producing anything or people who cannot find a job.

 "If we saw the slack opening up much more quickly, that would lead us to a different conclusion," he said.