CITY A.M. | SHADOW MPC VOTES TO STOP EASING
ALLISTER HEATH | CITY A.M.
“Hold interest rates again and don’t do any more QE. Inflation remains firmly above target. The problem is that banking capital rules have become too restrictive and we urgently need supply-side reforms.”
SIMON WARD | HENDERSON
“No change. Inflation control is a pre-requisite of improved economic performance, along with supply-side reforms and a reversal of the drive to higher bank capital requirements. Money growth is satisfactory allowing for rising velocity.”
GEORGE BUCKLEY | DEUTSCHE BANK
“No change on rates or quantitative easing (QE). Despite the UK economy returning to mild recession, inflation is proving sticky. Additional QE may perpetuate high inflation which is an issue given the two per cent target.”
TREVOR WILLIAMS | LLOYDS
“The Bank rate should be left on hold despite inflation being sticky. Consideration should be given to QE but a variation might be required to better target it at the right parts of the economy.”
VICKY REDWOOD | CAPITAL ECONOMICS
“I vote for another £50bn of quantitative easing. Inflation is being sticky, but this cannot last when the UK is back in recession and growth prospects are so dim. The MPC needs to be pro-active.”
GRAEME LEACH | IOD
“Hold rates and QE. While the UK is now technically in recession, it is too early to contemplate QE3. As the euro situation is again deteriorating, we may require further unconventional policy if it is not brought under control.”
HOLGER SCHMIEDING | BERENBERG BANK
“Another £25bn QE. The economy has not yet recovered from the recession that started last autumn and the new wave of euro crisis projects further near-term risks. This warrants some further asset purchases.”
ROSS WALKER | RBS
“Hold. The modest overshoot in inflation in the first quarter and some evidence of an improvement in the underlying economy warrants a pause. I keep a dovish bias as financial sector turmoil could escalate in the months ahead.”
VICKY PRYCE | FTI CONSULTING
“’Hold rates, but keep door open on further QE. The re-emerging Eurozone crisis is threatening the pace of any recovery and inflation worries should ease as world slowdown brings commodity prices down.”