- As data comes in BOE unemployment forecasts more likely to change than forward guidance
- MPC approach has been to provide stimulus but to pause and see if inflation expectations are firmly anchored, if they are and economy needs it more stimulus will be provided
- By adopting a probing approach (ooerr missus) MPC can provide the right degree of stimulus without diluting commitment to price stability
- BOE doesn’t understand why UK productivity is so weak
I’ve highlighted the first line as it emphasises the fact that there are still BOE forecasts aside from forward guidance, but we can safely assume that the market will incorrectly take any change of these forecasts as changes to forward guidance.
