{"id":68158,"date":"2023-03-01T11:30:40","date_gmt":"2023-03-01T11:30:40","guid":{"rendered":"https:\/\/www.taxresearch.org.uk\/Blog\/?p=68158"},"modified":"2023-03-01T11:30:40","modified_gmt":"2023-03-01T11:30:40","slug":"the-bank-of-england-needs-to-stop-playing-silly-games-when-it-comes-to-interest-rates","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2023\/03\/01\/the-bank-of-england-needs-to-stop-playing-silly-games-when-it-comes-to-interest-rates\/","title":{"rendered":"The Bank of England needs to stop playing silly games when it comes to interest rates"},"content":{"rendered":"<p>Andrew Bailey, the Governor of the Bank of England, <a href=\"https:\/\/www.bankofengland.co.uk\/speech\/2023\/march\/andrew-bailey-speech-at-cost-of-living-crisis-conference-brunswick-group?utm_source=Bank+of+England+updates&amp;utm_campaign=c3703dc621-EMAIL_CAMPAIGN_2023_03_01_09_52&amp;utm_medium=email&amp;utm_term=0_-c3703dc621-%5BLIST_EMAIL_ID%5D\" target=\"_blank\" rel=\"noopener noreferrer\">delivered a speech<\/a> this morning on the cost of living. His conclusion was:<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-large wp-image-68159\" src=\"https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.48.47-550x154.png\" alt=\"\" width=\"550\" height=\"154\" srcset=\"https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.48.47-550x154.png 550w, https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.48.47-768x215.png 768w, https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.48.47-1536x430.png 1536w, https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.48.47-600x168.png 600w, https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.48.47.png 1750w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/p>\n<p>However, the first chart that supported his speech was this:<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-large wp-image-68160\" src=\"https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.47.09-550x301.png\" alt=\"\" width=\"550\" height=\"301\" srcset=\"https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.47.09-550x301.png 550w, https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.47.09-548x300.png 548w, https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.47.09-768x420.png 768w, https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.47.09-1536x841.png 1536w, https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.47.09-600x328.png 600w, https:\/\/www.taxresearch.org.uk\/Blog\/wp-content\/uploads\/2023\/03\/Screenshot-2023-03-01-at-10.47.09.png 1794w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/p>\n<p>If you go behind this chart what you can actually find is a prediction by the Bank that there will, with 25% confidence, be deflation by 2024.<\/p>\n<p>I have in that case a simple question. If this chart reflects what the Bank thinks then why aren't they cutting interest rates, fast, now? After all, they are saying inflation is beaten.<\/p>\n<p>My alternative question is, if you think rate rises are still required why aren't the Bank reworking the chart to explain why that is necessary?<\/p>\n<p>My point is, you can't publish that chart and talk about rate rises when they so obviously are no longer required (if they ever were) which I doubt. That is tautologically impossible.<\/p>\n<p>It's time for the Bank to stop playing about on this issue and either say they are failing on inflation, and hence need rate rises, or they are winning and start cutting rates.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Andrew Bailey, the Governor of the Bank of England, delivered a speech this morning on the cost of living. His conclusion was: However, the first<br \/><a class=\"moretag\" href=\"https:\/\/www.taxresearch.org.uk\/Blog\/2023\/03\/01\/the-bank-of-england-needs-to-stop-playing-silly-games-when-it-comes-to-interest-rates\/\"><em> Read the full article&#8230;<\/em><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[35],"tags":[],"class_list":["post-68158","post","type-post","status-publish","format-standard","hentry","category-economics"],"_links":{"self":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/68158","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/comments?post=68158"}],"version-history":[{"count":0,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/68158\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/media?parent=68158"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/categories?post=68158"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/tags?post=68158"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}