BoE's Greene sees more volatile inflation from environment policy uncertainty

LONDON (Reuters) - Bank of England interest rate-setter Megan Greene said on Thursday that uncertainty around environmental policy was likely to increase the volatility of inflation in Britain.

Her comments come after Prime Minister Rishi Sunak last week pushed back the timescale of key net zero pledges, including banning the sale of new petrol cars.

Speaking at a panel about the economics of climate change, Greene agreed that inflation was likely to be more volatile in future than in past years, when low and stable inflation was the norm.

"A lot of it is driven by policy uncertainty. It's not our job to set policy, central banks aren't the best actors to set policy," Greene told the 3rd WE_ARE_IN Macroeconomics and Finance Conference.

"But insofar as all the actors in the economy aren't sure what the policy is going forward, the more inflation volatility there might be. So I agree there probably will be volatility around our 2% target."

(Reporting by Andy Bruce; Editing by Sachin Ravikumar)