Bailey Speech: Useful to Have a Predictable Path For Reversing QE

“Remarkable how little headline news there has been on UK economic activity since May.”

“Our view is inflation pressures will reduce.”

“We don’t see a spike in unemployment when furlough ends.”

“Number of unemployed people will be about 250,000 higher than before pandemic.”

“Should economy grows as expected, some modest tightening likely to be needed.”

“Growing evidence of job vacancies and labor market tightness.”

“Underlying pay growth is near pre-COVID levels.”

“Inflation is driven by higher costs of goods, supply bottlenecks, energy prices.”

“Recovery is unbalanced, weighted towards goods, not services.”

“MPC will focus on medium-term prospects for inflation, not transient factors.”

“If the outlook for inflation in jeopardy, MPC will not hesitate to act.”

“Reduction in the balance sheet is not a substitute for higher interest rates.”

“Useful to have a predictable path for reversing QE.”

“Stopping QE reinvestment gives a transparent path.”

“If we stuck with a 1.5% threshold for reversing QE, that would be tantamount to saying we were never doing it.”

“We expect the equilibrium interest rate to be very low for foreseeable future.”