The IEA Shadow MPC recommended a rise in Bank Rate by 50bps in August. Of those favouring a rise, five voted for an immediate rise of 0.50% but one member (David Smith) wanted a lesser rise of 0.25%. All those who voted to raise rates expressed a bias to raise rates further. One of those who voted to hold rates (Roger Bootle) had a bias to increase rates in the near future.
The Shadow Monetary Policy Committee (SMPC) is a group of independent economists, which has met once a quarter since July 1997 at the Institute for Economic Affairs (IEA) to monitor the MPC’s Bank Rate decisions, and to make rate recommendations of its own.
Let’s hope Carney & Co aren’t easily scared by their shadows but there appears to be a growing consenus that the hawks will start to strut their stuff this week.
“MPC rebels set to break Bank consensus on interest rates,” was the Sunday Times headline yesterday, saying a “minority of monetary policy committee members are expected to vote for a rate rise” this week
The countdown to the first rise begins in earnest this month but I’m not expecting any hikes til early next year and preferably Q2 for the sake of the UK recovery and householders
