The scale of borrowing “can only be compared to wartime”, says IEA expert

22 January 2021
Monetary Policy

The scale of borrowing “can only be compared to wartime”, says IEA expert

Responding to the latest government borrowing figures published by the Office for National Statistics (ONS), Christopher Snowdon, Head of Lifestyle Economics at the free market think tank the Institute of Economic Affairs, said:  “The national debt is enormous and will continue to grow for the foreseeable future. The scale of borrowing dwarfs that of the 2008 ... Continue reading
22 January 2021
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Third lockdown will cost UK economy billions

5 January 2021
Monetary Policy

Third lockdown will cost UK economy billions

Julian Jessop analysis quoted by Bloomberg

In a Bloomberg article warning that the UK economy is heading towards a double dip recession, analysis by IEA Economics Fellow Julian Jessop was included suggesting the lockdown could cost the economy £18 billion a month- the equivalent of 18% of gross domestic product. Read the full article here.... Continue reading
5 January 2021
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Six-week lockdown could cost £27 billion

5 January 2021
Monetary Policy

Six-week lockdown could cost £27 billion

Julian Jessop featured in The Sun

Responding to the news of another national lockdown, the IEA's Economics Fellow Julian Jessop calculated the potential cost of the measures on the UK economy. His analysis, predicting a 'six-week lockdown would cost the UK economy a whopping £27 billion', was featured in The Sun. Read the full article here.... Continue reading
5 January 2021
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Black economy amounts to between “9 and 12 percent of GDP”

9 December 2020
Monetary Policy

Black economy amounts to between “9 and 12 percent of GDP”

IEA research cited in The Times

In a column for The Times by economics editor of The Sunday Times, David Smith cites IEA research estimating that the black economy amounts to between 9 and 12 percent of GDP, or roughly £200bn. This, David argues, accounts for much of the reported £50 billion of "missing" banknotes. Read the full article here.... Continue reading
9 December 2020
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Shadow Monetary Policy Committee votes unanimously to Hold Bank Rate in November and rejects proposals for negative interest rates

30 October 2020
Monetary Policy

Shadow Monetary Policy Committee votes unanimously to Hold Bank Rate in November and rejects proposals for negative interest rates

In its meeting of 13th October 2020, held by video-conference due to ongoing COVID-19 restrictions, the Shadow Monetary Policy Committee (SMPC) elected, by a vote of nine to zero, to hold rates in August. One member favoured extending Quantitative Easing (QE) before the end of this year. Three favoured reducing QE once recovery is established. ... Continue reading
30 October 2020
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Extremely high growth rates of money could cause inflationary boom, says new briefing paper

18 June 2020
Monetary Policy

Extremely high growth rates of money could cause inflationary boom, says new briefing paper

New research from the Institute of Economic Affairs asks: Is inflation the next threat? The policy reaction to the Covid-19 pandemic will increase budget deficits massively in all the world’s leading countries; The deficits will to a significant extent be monetised, with heavy state borrowing from both national central banks and commercial banks; By mid- or ... Continue reading
18 June 2020
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Bank of England was right to hike and should do more

2 November 2017
Monetary Policy

Bank of England was right to hike and should do more

Julian Jessop comments on BoE interest rate rise

Commenting on the Bank of England raising interest rates by 0.25%, Julian Jessop, Chief Economist at the Institute of Economic Affairs, said: "The Bank of England made the correct decision today and should be ready to raise interest rates further next year, provided the economy continues to weather the impact of Brexit better than most ... Continue reading
2 November 2017
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Shadow Monetary Policy Committee calls for Bank Rate to be raised

31 July 2017
Monetary Policy

Shadow Monetary Policy Committee calls for Bank Rate to be raised

IEA's SMPC votes decisively for Bank Rate raise

The Institute of Economic Affairs' Shadow Monetary Policy Committee has voted decisively - eight votes to one - to recommend that the Bank of England's Monetary Policy Committee raise interest rates immediately. The SMPC's reasoning for voting for a Bank Rate rise are as follows: To reverse what was seen as a unnecessary cut last ... Continue reading
31 July 2017
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Bank rate cut is premature

4 August 2016
Monetary Policy

Bank rate cut is premature

Philip Booth comments on the decision to cut bank rate

Commenting on the news that the Bank of England will cut the base interest rate to 0.25 per cent, Philip Booth, Academic and Research Director and IEA SMPC representative said:  "Today's decision to cut the base interest rate is both disappointing and ill-advised. The post-Brexit economic problems are down to consumer and business uncertainty and ... Continue reading
4 August 2016
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Stable rules-based policy could avert another banking crisis

6 March 2016
Monetary Policy

Stable rules-based policy could avert another banking crisis

IEA releases new publication on lessons from the Great Recession

Central banks not only broke the rules leading to the financial crash, but again in response to tackling the crisis. A return to a situation where governments, together with surrounding institutions, follow rules rather than use their own discretion should be an explicit policy goal. Whilst rules go so far, nominal GDP targeting - whereby ... Continue reading
6 March 2016
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