Bank of England Governor Andrew Bailey said on Thursday the British central bank was walking a tight line between tackling inflation and avoiding recession, with the strength of the labour market a key question right now. The BoE last month softened its language on the need for more interest rate increases as rate-setters stressed downside risks to the economy, in addition to existing worries about inflation becoming embedded in expectations. "We are now walking a very tight line between tackling inflation and the output effects of the real income shock, and the risk that that could create a recession and pushes too ... (full story)