• UK economy faces prolonged period of balance sheet adjustment
  • UK needs a credible plan to reduce fiscal deficit substantially, clear to everyone
  • Need to rebalance to exports, away from imports, weaker sterling will help
  • Ultimately QE will help to stimulate spending, smooth rebalancing, keep CPI near target
  • Monetary policy can do very little to affect short-term moves in inflation
  • Despite recovery in growth, output unlikely to return to pre-crisis levels for sometime
  • Too loose policy could lead to asset price bubbles, higher inflation. Clearly at some point BOE will need to tighten policy, hard to say when
  • If we could see credit growing more rapidly that would be welcome
  • Q3 GDP numbers speak for themselves, no reason to second guess them. On average might expect it to be revised up slightly