.jpg)
In this speech Clare sets out her current view on the outlook for inflation and what this means for monetary policy. She then turns to how scenarios can help monetary policymakers consider how the economy may differ from a baseline and explores some of the issues raised by scenario analysis.
Speech
Good morning. Thank you for inviting me. It’s a pleasure to speak again at the Bank of England Watchers Conference.
Today I’m going to talk about two things: the outlook for inflation and reforms to our monetary policy processes.
My messages are: first, if you consider all the economic news, noise and bumpiness, underlying inflation pressures for the UK economy have continued to fall. So, it is sensible for us to continue our gradual and careful approach to reducing policy restrictiveness, including through another cut in Bank Rate by 25bps last Thursday.
And second, in reforming our monetary policy processes, we are putting risks and uncertainty more explicitly at the centre of our policy framework. This means important roles for scenarios and wider risk considerations alongside the central outlook. We are developing a wider framework and suite of analytical inputs to build uncertainties and risks into our policy deliberations when appropriate. In that context, I will talk this morning about how we used scenarios in our most recent policy round.
Click here for full details.
