16
Feb
Deputy governor suggests further rate action is warranted
The Bank of England is likely to need to take further action to
deal with the threat of inflation falling too low, its deputy
governor Charles Bean has commented.
Addressing the National Farmers Union in Birmingham, Professor Bean
- a member of the rate-setting monetary policy committee (MPC) -
said the consumer prices index measure of inflation is likely to
fall below its two per cent target in the spring and then run "well
below" that level for a substantial period of time.
He added that the MPC "will probably need to take further action to
return inflation to target in the medium term".
Further reductions below the current one per cent base rate could
help lower the cost of mortgages.
Minutes of this month's MPC meeting - at which the base rate was
trimmed by 0.5 per cent - will be published on February 18th,
revealing how Professor Bean and each of his colleagues
voted.
