The Bank’s low interest rates will block our path to sustainable recovery August 12, 2013 THE Bank of England wants to secure sustainable growth and reduce unemployment by promising to keep rates near zero for three more years. Its new “forward guidance” commits to maintain rates at current emergency levels, even in the face of economic growth and above-target inflation. The success of this strategy depends on encouraging more lending [...]
Three more years: Interest rates to stay at record lows until unemployment recovers August 7, 2013 NEW BANK of England governor Mark Carney dramatically tore up the UK’s monetary policy rules yesterday, pledging to hold rates at their historic low for another three years. The Bank’s new “forward guidance” system saw Carney promising that interest rate hikes and reductions to quantitative easing are off the table until the unemployment rate falls [...]
Mark Carney’s promise of prolonged low interest rates risks being broken August 7, 2013 THERE is a wind of change blowing through the Bank of England with new governor Mark Carney at the helm. Under his two predecessors – Eddie George and Mervyn King – the Monetary Policy Committee (MPC) was always very reluctant to make commitments about its future policy. The view was that the Committee would reassess [...]