Bank of England policymakers in parliament

inspector_monkfish

09:54 24Nov09 -Bank of England policymakers in parliament

LONDON, Nov 24 - Bank of England Governor Mervyn King and fellow Monetary Policy Committee members Paul Tucker, Paul Fisher, Adam Posen and Andrew Sentance took questions on the November Inflation Report from the lower house of parliament's Treasury Committee on Tuesday.
Following are highlights from the session.

KING ON INFLATION
"In the short run, inflation is likely to rise sharply, reflecting temporary factors such as an increase in petrol price inflation and the reversal of last year's cut in VAT. But in the medium term, the margin of spare capacity, if it persists, will continue to drag down on the outlook for inflation."

ANDREW SENTANCE ON SIGNS OF RECOVERY
"As the QE programme has proceeded, the economic news has improved. The deflationary risk has receded and evidence of stabilisation and recovery has begun to emerge. In response, I believe it has been appropriate to slow the rate of asset purchases."

inspector_monkfish

09:46 24Nov09 BOE KING: ENCOURAGED BY SIGNS RECOVERY SOON ON WAY
09:46 24Nov09 BOE KING: ECON CONTINUES TO FACE PROFUND CHALLENGES
09:47 24Nov09 BOE KING: SPARE CAPACITY TO PULL DOWN ON CPI IN MEDIUM TERM
09:48 24Nov09 BOE KING: NEED FOR CREDIBLE FISCAL PLAN CLEAR TO ALL
09:48 24Nov09 BOE KING: CONSUMPTION WILL TAKE LOWER SHARE OF NATL INCOME
09:50 24Nov09 BOE KING: MUST BE FUNDAMENTAL REFORM TO FINANCIAL SYSTEM
09:51 24Nov09 BOE KING: OWN VIEW CONSISTENT WITH INFLATION REPORT FORECASTS
09:52 24Nov09 BOE KING: MPC EXPECTS 1.5% GROWTH 2010, 3.0% IN 2011
09:54 24Nov09 BOE KING: EXPECT BUOYANT GROWTH RATES AFTER A SHARP RECESSION
09:55 24Nov09 BOE KING: RBS, LLOYDS LIQUIDITY FACILITIES REPAID BY JAN 2009
09:58 24Nov09 BOE POSEN: UK CORPORATE BOND MARKET "VERY UNDERDEVELOPED"
10:01 24Nov09 KING: BANKS SHOULD BE SUBJECT TO SAME MKT DISCIPLINE AS OTHERS
10:01 24Nov09 BOE KING: SHOULD BE POSSIBLE TO ALLOW BANKS TO FAIL
10:04 24Nov09 KING: BANK REGULATORS MUST BE TOUGH ENOUGH TO FORCE CHANGE
10:05 24Nov09 BOE King: Encouraged By Signs Recovery Soon On Way


LONDON--Bank of England Governor Mervyn King said Tuesday that the bank is encouraged by signs that recovery will soon be under way, but he warned that the U.K. economy will continue to face "profound challenges" ahead.

Giving evidence to U.K. lawmakers, King said spare capacity would drag down on inflation in the medium term, despite likely short-term sharp gains in
inflation. He also reiterated that a credible plan for fiscal consolidation is
clearly needed.

"The sharp falls in output appear to have come to an end and we are
encouraged by signs that a recovery will soon be under way," King said.

"But the recession means that the level of spending is now markedly lower
than it was in the first half of 2008. And looking ahead the economy continues to face profound challenges," he said.

foreversummer

Thanks inspector monkfish for continuing to post. I find myself coming to the board first thing each morning to get your concise and informative news reports. Much better than trawling through Google or the news channels!

Keep up the good work.:T

barrooo

Heres a padded out version

LONDON (Dow Jones)--Bank of England Governor Mervyn King Tuesday stressed the need for a credible plan to put the public finances on a sustainable path, saying the government should eliminate the structural budget deficit over the course of the next parliament.
Giving evidence to U.K. lawmakers, King said that tax revenue for the next five to 10 years was likely to be well below what would have been expected before the financial crisis, and that roughly 5% to 10% of output would be lost for an "indefinite period."
He also said that the U.K. was at no "immediate" risk of losing its cherished triple-A credit rating and that the threat was not a U.K. specific problem, but warned that the risk would become larger the longer no credible plan of action was put in place.
"It's got to be a really significant reduction in deficit, the elimination in large part of the structural deficit takes place over, say, the lifetime of a parliament, which is the period for which the government is elected," King said.
"But it will depend on the state of recovery of the economy. We hope it doesn't, but if the world economy were to fall back, and we were to find ourselves again in a period of downturn, it would not be sensible to expect the deficit to be eliminated that quickly."
Since the financial crisis began two years ago, the U.K. government has injected fiscal stimulus worth around 1.9% of gross domestic product into the economy, which, on top of the cost of bailing out leading banks and a sharp fall in tax revenue, means the budget deficit is set to hit around 12% of gross domestic product this financial year.
King said the central bank was encouraged by signs that the recovery will soon be under way, but he warned that the U.K. economy will continue to face "profound challenges" ahead.
He said spare capacity would drag down inflation in the medium term, despite likely short-term sharp gains in inflation.
"The sharp falls in output appear to have come to an end and we are encouraged by signs that a recovery will soon be under way," King said.
"But the recession means that the level of spending is now markedly lower than it was in the first half of 2008. And looking ahead the economy continues to face profound challenges," he said.

setmefree2

foreversummer wrote: »

Thanks inspector monkfish for continuing to post. I find myself coming to the board first thing each morning to get your concise and informative news reports. Much better than trawling through Google or the news channels!

Keep up the good work.:T

from me. I come to this board and look for your posts too.

Really2

setmefree2 wrote: »

from me. I come to this board and look for your posts too.

I come on here for sockpuppet argument trollfests....... Oh And the odd bit of news.

PS I agree on kings view on inflation, there is a hell of a lot of spare capacity world wide at the moment and will be for some time.

setmefree2

Really2 wrote: »

I come on here for sockpuppet argument trollfests....... Oh And the odd bit of news.

PS I agree on kings view on inflation, there is a hell of a lot of spare capacity world wide at the moment and will be for some time.

Of course, I come to this board to read your posts too