petetong Posted June 22, 2022 Share Posted June 22, 2022 (edited) Don't expect any significant interest rate rises, we'll be lucky to 0.25% with this piece of work at the helm. "The Bank of England’s chief economist has warned that raising rates to prop up the pound would be a “distraction” amid a widening split at the heart of Threadneedle Street. Huw Pill, who also sits on the rate-setting Monetary Policy Committee, said the Bank risked being distracted by thinking it could fine-tune the economy through rates. His comments came after fellow MPC member Catherine Mann on Monday publicly argued that rapidly boosting the returns on sterling deposits by raising rates could support the pound and help tame inflation. Sterling has fallen almost 10pc this year, leaving it as one of the worst-performing major currencies and making imports more expensive. Mr Pill said: “I worry that thinking that we can use that very blunt tool to do many things – stabilise the exchange rate in the short term, and ensure that any weakness in output is going to be weighed against and so forth and so on. “That can distract us from the task we’ve been given to do, and end up meaning that we are much less effective in achieving that task. “Monetary policy is not the panacea, monetary policy is not an instrument that allows you to achieve lots of lots of different things at short term – stabilise the exchange rate, fine-tune developments in employment or activity.” https://www.telegraph.co.uk/business/2022/06/21/raising-rates-shield-pound-distraction-says-top-bank-official/ Edited June 22, 2022 by petetong Quote Link to comment Share on other sites More sharing options...
BaldED Posted June 22, 2022 Share Posted June 22, 2022 2 hours ago, petetong said: “That can distract us from the task we’ve been given to do, and end up meaning that we are much less effective in achieving that task. “Monetary policy is not the panacea, monetary policy is not an instrument that allows you to achieve lots of lots of different things at short term – stabilise the exchange rate, fine-tune developments in employment or activity.” Is he pissed? Why not just come out and say we are hoping the FED can do all the work for us while we do piddly rises to make it look like we are doing something but in reality we are going full Turkey. How about he stops talking total ******** and say what he is actually doing and not what he isn't doing which we already know. Quote Link to comment Share on other sites More sharing options...
spyguy Posted June 22, 2022 Share Posted June 22, 2022 As Huw wheres my Pill refuses to use a 'blunt tool' Would he elaborate on which light, finely balanced tools hes going to use? The market says that the BoE has to set rates above the Fed. Always has. The BoE job is to just decide how far above the Fed its going to set rates. Quote Link to comment Share on other sites More sharing options...
dpg50000 Posted June 22, 2022 Share Posted June 22, 2022 48 minutes ago, spyguy said: As Huw wheres my Pill refuses to use a 'blunt tool' Would he elaborate on which light, finely balanced tools hes going to use? The market says that the BoE has to set rates above the Fed. Always has. The BoE job is to just decide how far above the Fed its going to set rates. As you keep saying, but that's clearly not going to happen in this rate cycle. Quote Link to comment Share on other sites More sharing options...
spyguy Posted June 22, 2022 Share Posted June 22, 2022 2 minutes ago, dpg50000 said: As you keep saying, but that's clearly not going to happen in this rate cycle. Yes it will. Quote Link to comment Share on other sites More sharing options...
dpg50000 Posted June 22, 2022 Share Posted June 22, 2022 2 minutes ago, spyguy said: Yes it will. No, it won't. As others have pointed out, the BOE are gambling on Fed rises and demand destruction to do their work for them. In the interim, we all get f ***ed by inflation. Quote Link to comment Share on other sites More sharing options...
Gush Posted June 22, 2022 Share Posted June 22, 2022 3 hours ago, BaldED said: say what he is actually doing and not what he isn't doing The media is so vocal in twisting trade union payrise request as paralyzing the economy, these bloody twits are the real cause and no one points the finger. Instead we are presented with this sh** shower as an expert who is shaping our future for good. Quote Link to comment Share on other sites More sharing options...
bartelbe Posted June 22, 2022 Share Posted June 22, 2022 This fool should be sacked immediately, he is doing nothing while inflation runs out of control. Quote Link to comment Share on other sites More sharing options...
Blobsy Posted June 22, 2022 Share Posted June 22, 2022 He’s saying bend over, and oh sorry, we’ve run out of lube. Quote Link to comment Share on other sites More sharing options...
Dorkins Posted June 22, 2022 Share Posted June 22, 2022 Quote Link to comment Share on other sites More sharing options...
Dorkins Posted June 22, 2022 Share Posted June 22, 2022 6 hours ago, petetong said: “Monetary policy is not the panacea, monetary policy is not an instrument that allows you to achieve lots of lots of different things at short term – stabilise the exchange rate, fine-tune developments in employment or activity.” In a sense this is all correct, but the question is why the BoE feels it has a mandate to ignore (exchange rate-driven) inflation in order to try to fine-tune developments in employment or activity. You had one job, if there's an internal debate about which objective to pursue how about the stable money one which is literally the first sentence on your website?: "The Bank of England Promoting the good of the people of the United Kingdom by maintaining monetary and financial stability." Quote Link to comment Share on other sites More sharing options...
Locke Posted June 22, 2022 Share Posted June 22, 2022 After the planes struck the Twin Towers, what action could anyone have taken to prevent their fall? It seems very difficult for people to accept that there are situations from which there is no recovery. The monetary terrorism of the past 60 years is the jet liner striking the Twin Towers of the economy. Progressive collapse is inevitable. Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted June 22, 2022 Share Posted June 22, 2022 8 hours ago, petetong said: Don't expect any significant interest rate rises, we'll be lucky to 0.25% with this piece of work at the helm. "The Bank of England’s chief economist has warned that raising rates to prop up the pound would be a “distraction” amid a widening split at the heart of Threadneedle Street. Huw Pill, who also sits on the rate-setting Monetary Policy Committee, said the Bank risked being distracted by thinking it could fine-tune the economy through rates. His comments came after fellow MPC member Catherine Mann on Monday publicly argued that rapidly boosting the returns on sterling deposits by raising rates could support the pound and help tame inflation. Sterling has fallen almost 10pc this year, leaving it as one of the worst-performing major currencies and making imports more expensive. Mr Pill said: “I worry that thinking that we can use that very blunt tool to do many things – stabilise the exchange rate in the short term, and ensure that any weakness in output is going to be weighed against and so forth and so on. “That can distract us from the task we’ve been given to do, and end up meaning that we are much less effective in achieving that task. “Monetary policy is not the panacea, monetary policy is not an instrument that allows you to achieve lots of lots of different things at short term – stabilise the exchange rate, fine-tune developments in employment or activity.” https://www.telegraph.co.uk/business/2022/06/21/raising-rates-shield-pound-distraction-says-top-bank-official/ Talking the market up and down. Insanity. Who decided ( gordon brown and bliar ) than 9 unelected shysters should have such control over our lives ? Quote Link to comment Share on other sites More sharing options...
Warlord Posted June 22, 2022 Share Posted June 22, 2022 23 minutes ago, TheCountOfNowhere said: Talking the market up and down. Insanity. Who decided ( gordon brown and bliar ) than 9 unelected shysters should have such control over our lives ? It's about time we got rid of bankster independence. I predict their inaction will sow the seeds of their own destruction. The public will start calling for it soon probably when the energy bills hit in the winter Quote Link to comment Share on other sites More sharing options...
skinnylattej Posted June 22, 2022 Share Posted June 22, 2022 10 minutes ago, Warlord said: It's about time we got rid of bankster independence. I predict their inaction will sow the seeds of their own destruction. The public will start calling for it soon probably when the energy bills hit in the winter Unless Rishi throws more money at the electorate! Quote Link to comment Share on other sites More sharing options...
Warlord Posted June 22, 2022 Share Posted June 22, 2022 5 minutes ago, skinnylattej said: Unless Rishi throws more money at the electorate! There is no money. They're tapped beyond belief now Quote Link to comment Share on other sites More sharing options...
zugzwang Posted June 22, 2022 Share Posted June 22, 2022 14 minutes ago, skinnylattej said: Unless Rishi throws more money at the electorate! Not yet. Sunak needs to hold something back to use as a General Election bribe. See also the 10% rise in the state pension. Quote Link to comment Share on other sites More sharing options...
zugzwang Posted June 22, 2022 Share Posted June 22, 2022 3 hours ago, spyguy said: As Huw wheres my Pill refuses to use a 'blunt tool' Would he elaborate on which light, finely balanced tools hes going to use? The market says that the BoE has to set rates above the Fed. Always has. The BoE job is to just decide how far above the Fed its going to set rates. QT of course. But don't hold your breath. Quote Link to comment Share on other sites More sharing options...
Dorkins Posted June 22, 2022 Share Posted June 22, 2022 3 minutes ago, zugzwang said: Not yet. Sunak needs to hold something back to use as a General Election bribe. See also the 10% rise in the state pension. Sunak already pre-announced his General Election bribe for pensioners of a 1% cut in income tax. So NI will keep cranking up while income taxes come down making workers poorer and people with investment (including pension) income richer Quote Link to comment Share on other sites More sharing options...
Confusion of VIs Posted June 22, 2022 Share Posted June 22, 2022 8 hours ago, dpg50000 said: No, it won't. As others have pointed out, the BOE are gambling on Fed rises and demand destruction to do their work for them. In the interim, we all get f ***ed by inflation. This winters £3-4,000 energy bills will do quite a bit of the demand reduction work for him. Quote Link to comment Share on other sites More sharing options...
Zzzzzzzzzzzzzzzzzzzzzzzzzz Posted June 22, 2022 Share Posted June 22, 2022 (edited) Basically, the Bank of England's hand will be forced by the Fed... Huw knows, that... we know that here in the financial sector in London. Poor old Huw is feeling the pressure and becoming a tad tetchy, it seems - diddums... what a tw*t! Edited June 22, 2022 by Sausages Quote Link to comment Share on other sites More sharing options...
NoHPCinTheUK Posted June 22, 2022 Share Posted June 22, 2022 (edited) What about bringing these bankers back to their role and not pretending that are some sort of superheroes that can save the world. I’m talking about the BoE, I don’t care about the FED and frankly the ECB is there to buy broken countries’ govies. The BoE should be there to provide liquidity to the banking system when they need it. They should be there to protect the purchasing power of the £ in time of extreme stress. We can’t just really pretend that those people solve the housing crisis, the productivity crisis, the cost of living crisis. The little secret is that markets and the economy don’t give a fleak about what these people do and say. The market and the economy is already ahead the BoE curve and there’s nothing they can do. What would change is they raise rates? Rates in the real economy are already moving up. Banks do not lend money at 1% if inflation is expected to be at 10% for the next 5 years. The markets are pricing a recession and demand destruction. 20y and 30y gilts are not saying these are the 70s all over again. Edited June 22, 2022 by NoHPCinTheUK Quote Link to comment Share on other sites More sharing options...
frederico Posted June 22, 2022 Share Posted June 22, 2022 Bit of a problem for the old dimwits isn't it. I'd like to know what they can do as well, Rates going up may be a blunt destructive tool, but it is literally all they've got. This is as bad as its been in living memory. So all bets are off Quote Link to comment Share on other sites More sharing options...
Slumpmonkey Returns Posted June 22, 2022 Share Posted June 22, 2022 What's the betting Mr Pill has a substantial property portfolio to protect?😆 Quote Link to comment Share on other sites More sharing options...
Zzzzzzzzzzzzzzzzzzzzzzzzzz Posted June 22, 2022 Share Posted June 22, 2022 20 minutes ago, Slumpmonkey Returns said: What's the betting Mr Pill has a substantial property portfolio to protect?😆 Could you do a FOI request to find out, I wonder? Or perhaps they declare interests publicly already? Quote Link to comment Share on other sites More sharing options...
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