BOE's Carney says UK economy is operating just below potential

Author: Adam Button | Category: Central Banks

Comments from Carney:

  • Surveys point to economy stagnating in Q3
  • After no-deal Brexit it would be more likely to ease policy than not
  • "Limited and gradual" interest rate increases likely to be needed if there's a Brexit deal
  • Underlying UK growth is likely positive but muted
  • US dollar dominance of financial system increases risks of a global liquidity trap
  • Reducing dollar spillovers should be long-term goal
  • Calls for a multi-polar reserve currency system
  • Weak business investment is biggest UK headwind
  • Synthetic hegemonic currency could dampen domineering influence of the US dollar on global trade
  • Full speech
He's calling for a Libra-like currency to the end the dollar's dominance. That's a good idea, I just don't think the US would ever allow it.

In terms of monetary policy, I would have expected something more dovish given that other central banks are cutting.

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