Tuesday, January 20, 2004
Who'd be a central banker?
Posted by David Smith at 05:28 PM
Category: Thoughts and responses

Mervyn King, governor of the Bank of England, is uncomfortable with the switch in the Bank of England's inflation target, as is clear from this speech. His message is that the switch to the new consumer price index, which has inflation at 1.3% against a 2% target, is irrelevant for monetary policy. Inflation on the old target measure is running at 2.6%, just above its old 2.5% target. King appears to be paving the way for a February rate hike but it has become a closer-run thing than first appeared.

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