Bank of England wrong to continue policy of quantitative easing, says IEA expert
23 September 2021
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In the Media
IEA research cited in The Telegraph
23 September 2021
In the Media
Economic Theory
11 November 2024
Commenting on the Bank of England’s decision to continue its policy of quantitative easing, Julian Jessop, Economics Fellow at free market think tank the Institute of Economic Affairs (IEA), said:
“The Bank of England’s decision to maintain its existing programme of money printing means that it is keeping the foot on the accelerator despite mounting evidence that the UK economy is overheating.
“Most members of the Monetary Policy Committee have judged that the news of stronger inflation has been offset by signs of a slowdown in the growth of activity. This is fair enough, but may still be complacent.
“The Bank is only expecting consumer price inflation to be ‘slightly above 4 per cent’ in the fourth quarter, despite growing upside risks. The slowdown in activity also appears to be due mainly to problems on the supply side, rather than a lack of demand. A prolonged period of above-target inflation would add to the squeeze on real incomes and undermine the credibility of the Bank itself.
“The Shadow Monetary Policy Committee, a group of independent economists which meets at the IEA, has been arguing for some time that the Bank should end its policy of quantitative easing at the earliest opportunity. The official MPC has missed that chance today”.
ENDS
Notes to editors
Contact: Emily Carver, Head of Media, 07715 942 731
IEA spokespeople are available for interview and further comment
“The Bank of England’s decision to maintain its existing programme of money printing means that it is keeping the foot on the accelerator despite mounting evidence that the UK economy is overheating.
“Most members of the Monetary Policy Committee have judged that the news of stronger inflation has been offset by signs of a slowdown in the growth of activity. This is fair enough, but may still be complacent.
“The Bank is only expecting consumer price inflation to be ‘slightly above 4 per cent’ in the fourth quarter, despite growing upside risks. The slowdown in activity also appears to be due mainly to problems on the supply side, rather than a lack of demand. A prolonged period of above-target inflation would add to the squeeze on real incomes and undermine the credibility of the Bank itself.
“The Shadow Monetary Policy Committee, a group of independent economists which meets at the IEA, has been arguing for some time that the Bank should end its policy of quantitative easing at the earliest opportunity. The official MPC has missed that chance today”.
ENDS
Notes to editors
Contact: Emily Carver, Head of Media, 07715 942 731
IEA spokespeople are available for interview and further comment
6 thoughts on “Bank of England wrong to continue policy of quantitative easing, says IEA expert”
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Correct
Fascist States always have used inflation as a means of impoverishing the citizens, we should all remember the Cantillon effect, why says that those closest to the monetary pump,benefit most from it
Could you please clarify what the terms
MMT and DMF means.?
Does the treasury have to repay all of the QE
Gilt purchaces by the B of E.?
Just stop the headline at ‘Bank of England wrong’ . ‘cos it always is and has been.
That is a pretty weak statement from IEA, especially in the light of advice from their own shadow monetary policy committee.
M3 and M0 are the figures to watch. Everything else is just noise.