BOE's Ramsden says weak productivity remains a key consideration of monetary policy
BOE MPC's Ramsden out with scheduled speech 23 Feb
Nothing directly on interest rate hikes but maybe a Q&A to come so will stand poised.
Productivity rose in latest UK labour report fyi.
GBPUSD currently heading back up to test 1.4000 but not related to this post particularly.
- Structural shocks to the economy from Brexit can't be offset by monetary policy
- MPC views weakness and uncertainty of UK productivity as a key consideration for monetary policy
- Pace of productivity influences what happens to inflation
- Most recent data show signs of productivity growth rising in the second half of 2017
- Still no confirmation that productivity pickup is sustained in the near-term
- UK business investment has been unusually weak relative to past recoveries
- MPC's judgement is that productivity growth will settle at just over 1% over the next three years
- MPC's view is that the economy's speed limit is likely to be around 1½%
- There are significant risks in both directions to the outlook for productivity
- Naturally lower productivity growth, and dampening effect of Brexit are risks to productivity
- A clearer transition path and future trading arrangements post-Brexit, could reduce uncertainty
- Latest evidence from Bank's Decision Maker Panel Survey suggests impact of Brexit holding back business investment growth may be less in 2018 than 2017
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