This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at https://www.theguardian.com/business/live/2018/may/10/bank-of-england-interest-rate-decision-mark-carney-bt-rbs-trade-business-live
The article has changed 7 times. There is an RSS feed of changes available.
Version 0 | Version 1 |
---|---|
Bank of England governor Mark Carney defends leaving interest rates on hold again - business live | Bank of England governor Mark Carney defends leaving interest rates on hold again - business live |
(35 minutes later) | |
And finally... | |
Q: The Office for National Statistics has just lowered its estimate of the UK trade deficit by a quarter - so how reliable is Britain’s data, and does it mean that the UK is still ‘reliant on the kindness of strangers’ [an old Carney quote] | |
Great question, says Mark Carney, who bats it across to deputy Ben Broadbent. | |
Broadbent explains that economic data can always be revised and updated as new information comes in, and economists update and refine their models. It’s a mistake to treat it as God-given and fixed. | |
That’s the end of the press conference. | |
Q: What impact would a hard Brexit have on the Bank’s economic forecasts? | Q: What impact would a hard Brexit have on the Bank’s economic forecasts? |
Mark Carney replies that a hard Brexit would prompt a change the Bank’s forecasts. But such a scenario it’s not currently included in its economic projections, which are based on a ‘transition deal’ being agreed and implemented. | Mark Carney replies that a hard Brexit would prompt a change the Bank’s forecasts. But such a scenario it’s not currently included in its economic projections, which are based on a ‘transition deal’ being agreed and implemented. |
Handily for the Bank, the likely end of that transition deal comes beyond its current forecast horizon, so it doesn’t need to map the implications (yet....). | Handily for the Bank, the likely end of that transition deal comes beyond its current forecast horizon, so it doesn’t need to map the implications (yet....). |
The Bank has, though, been ensuring that Britain’s banks are well capitalised to handle a Brexit shock. | The Bank has, though, been ensuring that Britain’s banks are well capitalised to handle a Brexit shock. |
Q: Today’s quarterly inflation report suggests that some business surveys are painting a better (and more optimistic) picture of the UK economy than the official GDP data. So which ‘soft’ data do you take seriously? | Q: Today’s quarterly inflation report suggests that some business surveys are painting a better (and more optimistic) picture of the UK economy than the official GDP data. So which ‘soft’ data do you take seriously? |
Deputy governor Ben Broadbent argues that there’s no contradiction between strong business surveys (which often track sentiment) and weaker GDP data (which measures actual output). | Deputy governor Ben Broadbent argues that there’s no contradiction between strong business surveys (which often track sentiment) and weaker GDP data (which measures actual output). |
Those business surveys have dropped to lower levels, but they don’t point to anything as weak as 0.1% growth (the official first estimate of UK GDP). | Those business surveys have dropped to lower levels, but they don’t point to anything as weak as 0.1% growth (the official first estimate of UK GDP). |
Good points from Duncan Weldon of the Resolution Group: | Good points from Duncan Weldon of the Resolution Group: |
Bank comms quite confusing. “We haven’t really changed our outlook much” coupled with “we are a bit less sure on the rate path”.Feels like an attempt to get out of forward guidance/keep their options open. | Bank comms quite confusing. “We haven’t really changed our outlook much” coupled with “we are a bit less sure on the rate path”.Feels like an attempt to get out of forward guidance/keep their options open. |
Which given Brexit talks uncertainty this year is sensible. But when you’ll relied on guidance to the extent Carney has, it’s hard to get across that you are genuinely unsure. | Which given Brexit talks uncertainty this year is sensible. But when you’ll relied on guidance to the extent Carney has, it’s hard to get across that you are genuinely unsure. |
Q: What’s the biggest challenge for your successor, governor? Brexit, perhaps? | Q: What’s the biggest challenge for your successor, governor? Brexit, perhaps? |
The biggest challenge, and opportunity, for the country is the Brexit negotiations, Mark Carney replies. He won’t be drawn about his replacement, though (Carney is due to leave the Bank in June 2019). | The biggest challenge, and opportunity, for the country is the Brexit negotiations, Mark Carney replies. He won’t be drawn about his replacement, though (Carney is due to leave the Bank in June 2019). |
Q: Today’s inflation report seems to suggest that interest rates will rise three times in the next three years - should households expect that? | Q: Today’s inflation report seems to suggest that interest rates will rise three times in the next three years - should households expect that? |
Carney repeats his line that UK households and businesses broadly expect a rate rise this year, and two increases in the next 18 months. But it all depends on how the economy develops. | Carney repeats his line that UK households and businesses broadly expect a rate rise this year, and two increases in the next 18 months. But it all depends on how the economy develops. |
Q: Hasn’t your message on interest rates been diluted since February (when the Bank said rates would probably rise faster than markets expected)? | Q: Hasn’t your message on interest rates been diluted since February (when the Bank said rates would probably rise faster than markets expected)? |
Our ‘core message’ hasn’t changed, Carney insists. | Our ‘core message’ hasn’t changed, Carney insists. |
Q: Isn’t there also a danger that wage pressure will also be more muted than the Bank expects? | Q: Isn’t there also a danger that wage pressure will also be more muted than the Bank expects? |
Regular pay has been inline with the Bank’s expectations, Carney replies. | Regular pay has been inline with the Bank’s expectations, Carney replies. |
Some snap reaction to Carney’s press conference: | Some snap reaction to Carney’s press conference: |
There seem to be two immutable laws of Carney's governorship:1) Rates never go upbut2) Rate rises are always around the corner! pic.twitter.com/LjFJ1MfZHj | There seem to be two immutable laws of Carney's governorship:1) Rates never go upbut2) Rate rises are always around the corner! pic.twitter.com/LjFJ1MfZHj |
Bank of England Governor Mark Carney says it's only financial journalists who call him the "unreliable boyfriend". But let us not forget, it was Labour's @patmcfaddenmp who coined it! 😃 | Bank of England Governor Mark Carney says it's only financial journalists who call him the "unreliable boyfriend". But let us not forget, it was Labour's @patmcfaddenmp who coined it! 😃 |
Slight dig from Carney on EU financial orgs saying they only just recovered from financial crisis: 'we fixed ours a long time ago' | Slight dig from Carney on EU financial orgs saying they only just recovered from financial crisis: 'we fixed ours a long time ago' |
Q: Are you failing to communicate to the UK public? | Q: Are you failing to communicate to the UK public? |
Carney says that the UK public have understood the Bank’s message in recent years, that interest rates will rise gradually as economic conditions merit it. | Carney says that the UK public have understood the Bank’s message in recent years, that interest rates will rise gradually as economic conditions merit it. |
And he takes a wider view, saying that Britain is in a ‘different place’ than Europe (which has more spare capacity, and has only just fixed its financial system), but also a ‘different place’ than America (which doesn’t face the same scale of uncertainty over its future trading relationship). | And he takes a wider view, saying that Britain is in a ‘different place’ than Europe (which has more spare capacity, and has only just fixed its financial system), but also a ‘different place’ than America (which doesn’t face the same scale of uncertainty over its future trading relationship). |
People across the UK understand that, Carney adds. | People across the UK understand that, Carney adds. |
Q: Are you worried that the ‘unreliable boyfriend’ tag will stick, as you’ve once hinted that a rate rise was coming, but not delivered? | Q: Are you worried that the ‘unreliable boyfriend’ tag will stick, as you’ve once hinted that a rate rise was coming, but not delivered? |
The households and businesses we speak to don’t trade short sterling**, Carney shoots back. They want to know the general orientation of the economy, that the economy is healthy, and the likely path of interest rates. | The households and businesses we speak to don’t trade short sterling**, Carney shoots back. They want to know the general orientation of the economy, that the economy is healthy, and the likely path of interest rates. |
(** - short sterling is a way of betting on the future path of interest rates). | (** - short sterling is a way of betting on the future path of interest rates). |
The only people who throw the ‘unreliable boyfriend’ tag at me are in this room, Carney tells the press conference. | The only people who throw the ‘unreliable boyfriend’ tag at me are in this room, Carney tells the press conference. |
Now everyone else can use it too. | Now everyone else can use it too. |