Annual report to lawmakers comments are starting to come out

Broadbent comments

  • risks for UK unemployment are in both directions
  • there is a clear risk that unemployment will rise significantly once support for low schemes come to an end
  • no indication from bond markets that investors see MPC's actions as anything other than necessary to meet inflation objective
  • Brexit deal doesn't have big direct inflation impact
  • we have seen a sterling appreciate because of EU trade deal that would have some depressive effect on UK inflation
  • hard to know if trade frictions are having opposite effect on inflation
  • main effect on UK inflation probably from sterling strength
  • latest UK employment and wage numbers are quite fiddly
  • medium-term impact of household savings less significant
  • over the course of this year, how fast households spend accumulated savings could have material impact on growth
  • our current monetary policy is largely explained by the fact that we expect unemployment to go up

Haskel comments

  • faster vaccine rollout that government plans is upside risk for economy
  • downside risks to February forecasts are much more prevailant
  • firm's ability to repay debts and avoid insolvency represents a sizable downside risks
  • risk that worries me most is highly transmissible Covid variants
  • risk to activity very much on downside; risks to supply balanced
  • remains open to possibility economy might need further support
  • concerns about uncertainty over future trade with EU; substantial downside risk to consumer spending monitoring container shortages, should be short run

Bailey comments

  • EU locality policy for financial services is controversial of dubious legality
  • asking firms to move businesses would be escalation
  • would be concerned from financial stability perspective if EU tried to force institutions to localize some operations in EU
  • Erosion of stability of global clearing system would be a concern
  • numbers on Covid are now more positive for UK economy
  • evidence so far of current lockdown is that activity puts it midway between 1st and 2nd lockdown
  • pandemics going to UK economy will be limited
  • concern over shift of clearing to EU jurisdictions is that there is a tipping affect at some point
  • big question for US economy is what fiscal package is agreed
  • fiscal package in US will contribute to global growth, there will be positive spillover

Vlieghe comments

  • hard to know if economy will need extra help, risks are tilted to the downside
  • big uncertainty is whether economy fully returns to pre-Covid path once restrictions removed
  • with vaccine, we are getting close to reaching a point where there are no serious restrictions on economic activity