BOE's Saunders: Aggressive steps needed given limited monetary policy space
Saunders continues to state his case for dissent
- It probably will be appropriate to maintain an expansionary monetary policy
- And also to possibly cut rates further
- Monetary policy space is limited
- Risk considerations favour a relatively prompt, aggressive response to downside risks
- Most likely outlook is a further period of subdued growth
- Economic growth is sluggish, spare capacity is rising, inflation is subdued
- Brexit uncertainty may continue, weigh further on the economy
- Neutral level of interest rates may have fallen further over the last year or two
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The pound is continuing to linger at session lows with cable down to 1.3001 currently as Saunders reaffirms his position in dissenting and voting in favour of cutting rates.
As he suggests, if economic data continues to deteriorate, expect more MPC members to join himself and Haskel in subsequent meetings. But the comments above doesn't add much of anything new as he is already one of the leading voices in calling for a rate cut.