Comments from Bank of England Governor Mark Carney:
- Upward move in market expectations of BOE rates could, at margin, affect real economy
- BOE’s forward guidance was clear that we would provide more stimulus if necessary
- Signs are the UK recovery is broad based, set to continue
- Period of growth needed to begin to reduce space capacity meaningfully
- Depressed output, temporary inflation factors mean it is right to bring inflation back to target more slowly
- Nobody should assume 7% unemployment is trigger for rate hike
- Unemployment must be at least 7% for hike
- BOE to reduce required liquid asset holdings for major banks meeting 7% capital thresholds
- Acutely aware of unsustainable credit and house price growth, will monitor it closely
- Full text (pdf)
Cable initially fell to the lows of the day at 1.5429 but has quickly reversed, touching 1.5536. Watch for buy stops above 1.5555. If he was aiming to be dovish, he’s failed. Nothing jumps out on the hawkish side but he’s upbeat about growth which is positive.
Mark Carney delivering his first speech today
A live feed of the speech is here.
Afterwards, the press conference video will be here.
