- Energy prices are driving up prices in the short term, but have a disinflationary impact in the medium term
- BOE needs to balance the impact of the energy with any secondary effects
- I would expect the bank trade counter at 3% during 2023 to reduce output further below potential
- policy will probably have to relax in 2024 to try to prevent inflation from falling below target
- policy should focus on inflation, without compensating for loss of yields from guilt or exchange rates
- most of the impact on demand from tighter banking trading still seems
- my main reason for tightening monetary policy further last week was risk management
- BOE needs to guard against overtightening policy
- it is too early to judge whether the labor market will ease as forecast by the Bank of England
- UK demand is likely to fall even if energy prices fall again
- early signs and the UK labor market is beginning to relax
- The UK is likely to enter a recession in the fourth quarter, mainly due to lower real income.
