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Help is at hand in the form of this handy graphic and Excel file (last updated yesterday) pulled together by a team at Institute of Empirical Economic Research at the University of Osnabrück in Germany (hat tip to David Marsh at OMFIF for the link):

The speech presents the case for doing more based in part on the view that, if the MPC continues to do nothing, or — worse still — tightens policy, then this could destroy the UK economy’s productive capacity and, hence, its ability to grow at the pace seen before the financial crisis. 

The vote, which left David Miles as the sole member voting in favour of more money printing for the second month in a row, was more hawkish than most had expected.

The IMF certainly thinks so.

Today the Fund said the Monetary Policy Committee should print more money and cut the policy rate below 0.5 per cent. This, they argued, would lower yields further out on the curve, which in turn would lower businesses’ borrowing costs.

The Fund also said the Bank should consider buying assets other than government bonds in order to revive the UK’s beleaguered mortgage market and counter tough conditions for businesses. An LTRO-style operation was another option.

Will the Bank follow the IMF’s advice? The MPC might well plump for more QE in the coming months. But, in the short term at least, it is very unlikely to pursue the other measures.

About time too.

The Bank is the only one of the Tripartite authorities yet to conduct an investigation into its handling of the turmoil.

But better late than never. Despite the Court’s tardiness, the three reviews announced today should be welcomed.

BoE minutes

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

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.

Broad money growth of 6-8 per cent would have suited the Bank — and the UK economy — nicely. If only.

As the chart above shows, quantitative easing has failed to produce the sort of pick-up that the MPC had hoped for.

There are many reasons for this. One of which, according to former MPC member Charles Goodhart, is the Bank’s practice of paying interest on reserves held in their coffers.

Mr Goodhart today accused the authorities as having “connived” would-be lenders into keeping their cash on deposit at the central bank by paying interest of 0.5 per cent on banks’ reserves.

Mr Goodhart argued that this is discouraging banks from lending. After all, why bother to risk making a loss on a bad loan if you can earn interest by parking your cash at the central bank?