Bank Of England: Inflation Expectations, Inflation Persistence, And Monetary Policy Strategy – Speech By Catherine L. Mann, Member Of The Monetary Policy Committee, Given At The 53rd Annual Conference Of The Money Macro And Finance Society, University Of Kent

Catherine L. Mann describes how inflation expectations affect the Phillips curve. She then presents data on survey and financial market expectations about inflation in the short, medium, and long run. She analyses whether these are consistent with our 2% inflation target and what that implies for monetary policy strategy.

At its meeting last month, the Monetary Policy Committee came together to deliver on its pledge that it would react forcefully in response to more persistent inflationary pressures. A large majority agreed that this condition had been met and that we were indeed seeing persistence so the hike by a half percentage point was the appropriate course of action at that meeting. This sends a strong signal that the MPC is committed to leaning against domestic inflation pressures becoming further entrenched.

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