More from Carney & Co.: path at Nov. report was 2 hikes, now almost 3
|Headlines continue to pour in from the BOE's inflation report hearings before Parliament's Treasury Committee:
BOE Governor Mark Carney:
• Further stimulus withdrawal needed in coming years
• Case for withdrawal of stimulus will be there if GDP exceeds 1.5%
• Path at Nov. report was 2 hikes, now almost 3
• Interest rates will not return to long-run average of 5%
• Monetary policy is nimble and will react to changing economic expectations linked to Brexit
• The need for a direct pre-commitment to raise interest rates has gone away
BOE Chief Economist Andy Haldane:
• Reasons for more hawkish view now is stronger world economy and somewhat in UK too
• Last year has seen stronger than expected momentum
• Balance of risks to the path of interest rates necessary to return inflation sustainably to target to the upside, based on potential for faster global and UK growth
• There are huge amounts of uncertainty around BoE's estimate of 1% annual long-run productivity growth in UK
BOE Deputy Governor Ben Broadbent:
• Degree of UK spare capacity has shrunk
• Sees firming of inflationary pressures
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