BOE governor Mark Carney comments in the inflation report hearing
- Brexit creating tensions for consumers, businesses
- Gradual hikes are needed if economy performs as expected
- BOE won't reduce QE holdings until rate reaches at least 1.50%
- Will provide all stimulus possible after no-deal Brexit, subject to price stability
- No-deal Brexit will be inflationary
We're also hearing from the central bank's MPC members Ramsden and Vlieghe:
- Inflation likely to stay above target in the medium-term
- Near-term weakness in inflation has passed
- If Brexit transition is successful, exchange rate should appreciate somewhat
- Pay growth has picked up but has not so far led to upwards inflation pressure
- 0.25% rate hike per year seems a reasonable central case
There's nothing new in terms of what is being mentioned by Carney and his colleagues here. This is mostly in-line with what we heard at the start of the month after the BOE monetary policy meeting. But I guess if you really want to look at positives, the fact that Carney has said that they will provide stimulus and liquidity to support banks and the economy is a positive signal.
