Daily Archives: May 16, 2012

Claire Jones

RTRS: ECB STOPS MONETARY POLICY OPERATIONS TO SOME GREEK BANKS AS RECAPITALISATION NOT IN PLACE -CENBANK SOURCE

The Reuters headline above has sparked panic this afternoon. Is the panic warranted?  

Claire Jones

Sir Mervyn King. Image by Getty.

Sir Mervyn King. Image by Getty.

Hello and welcome to today’s live blog on the Bank of England’s Inflation Report press conference. The governor is due to begin speaking at 10.30am.

This post should update automatically every few minutes, although it might take longer on mobile devices. All times are UK time.

 

11.56 This live blog is now closed.

11.49 Here are the key takeaways:

  • Growth is lower, and inflation higher, in the short term, but “the big picture” on the UK economy remains the same. The governor acknowledged, however, that the UK’s productivity problems may be more persistent than previously thought, which is significant given that this would lessen the amount of growth the economy can tolerate without higher inflation.
  • More QE is a possibility given that the central forecasts show inflation edging below 2 per cent two years from now. It would appear that further asset purchases (and more liquidity) are pretty much a certainty if the eurozone crisis worsens.
  • The Bank is not too concerned about the recent appreciation of the pound. Not yet anyway.
  • The governor was unwilling to opine on fiscal policy. Which makes a change.