Governor Carney - Coronavirus “economic shock could prove large but will ultimately be temporary”
Bank will “take all necessary steps” consistent with statutory responsibilities
FPC/MPC & FCA met jointly yesterday.
Bank will “take all necessary steps” consistent with statutory responsibilities
FPC/MPC & FCA met jointly yesterday.
Gov Carney says BoE analysing scenarios incl
- extent to which supply disruptions have demand consequences incl impacts on cashflow
- addressing constraints on financing to businesses that might emerge
- reviewing contingency plans of banks, incl split teams and remote working
- extent to which supply disruptions have demand consequences incl impacts on cashflow
- addressing constraints on financing to businesses that might emerge
- reviewing contingency plans of banks, incl split teams and remote working
“Reasonable to expect a response that reflects a combination of fiscal measures and central bank initiatives...”: Carney... talked about possible changes to capital buffers in order to help banking system support viable firms working capital
“Shock could be large... the prospect with this situation is that we will have disruption not destruction”... focus of policy should be to bridge over [the disruption]... says Carney: “persistence of the impact could and should be different to 2008”.
very informative thread from former top ECB central banker on this issue of what monetary policy can do ...
“In its history MPC has always acted in a timely way... Committee will act at the appropriate time,” says carney asked if there could be an immediate cut.
Deputy Governor Dave Ramsden saying that assumptions of last forecast was global growth picking up and investment here too - “we’ll have to revisit it”...
Other interesting bit of this was Governor Carney saying that the Bank of England hasn’t run out of ammo, with QE and other things it still has the equivalent of 200-250 basis points of space - if what it can do in the financial system is the equivalent of cutting rates to -1%...
Also a former top economics journalist @anthonybrowneuk is a new member of the Treasury Select Committee, and there was a nice valedictory moment between @SteveBakerHW and the Governor, who have occasionally clashed. The former heaping praise on Carney’s tenure as Governor.
