Practical Issues in United Kingdom Monetary Policy, 2000–2005

2007 ◽  
Author(s):  
STEPHEN NICKELL
Keyword(s):  
Monetary Policy ◽  
United Kingdom ◽  
Asset Prices ◽  
Household Debt ◽  
Rapid Rise ◽  
Inflation Target ◽  
Monetary Policy Committee ◽  
Housing Boom ◽  
Bank Of England

This chapter discusses some of the topics the Bank of England Monetary Policy Committee has spent a lot of time on. It first examines the rapid rise in household debt and its implications for monetary policy. The next section looks at the role of asset prices in monetary policy, with particular reference to the recent UK housing boom. Finally, the chapter discusses the implications of the switch in the inflation target at the end of 2003.

Changing the Inflation Target

2003 ◽  
Vol 185 ◽  
pp. 50-53 ◽  
Author(s):  
Ray Barrell ◽  
Simon Kirby ◽  
Rebecca Riley
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Price Index ◽  
Short Term ◽  
Inflation Target ◽  
Central Target ◽  
Mortgage Interest ◽  
Monetary Policy Committee ◽  
Bank Of England ◽  
Interest Payments

Since May 1997, when the Bank of England was given operational independence to set monetary policy, the Monetary Policy Committee (MPC) has been responsible for setting short-term interest rates to ensure that the Government's inflation target is met. The target is currently 2.5 per cent and the target measure is the Retail Price Index excluding mortgage interest payments (RPIX). If RPIX inflation deviates more than 1 per cent from the central target, the Governor of the Bank of England is expected to provide a written explanation to the Chancellor of the Exchequer as to why the inflation target has been missed.

scholarly journals Asset prices regime-switching and the role of inflation targeting monetary policy

2017 ◽  
Vol 32 ◽  
pp. 97-112 ◽  
Author(s):  
Ioannis Chatziantoniou ◽  
George Filis ◽  
Christos Floros
Keyword(s):  
Monetary Policy ◽  
Regime Switching ◽  
Asset Prices ◽  
Inflation Targeting

The UK economy

1999 ◽  
Vol 169 ◽  
pp. 8-30
Author(s):  
Richard Kneller ◽  
Garry Young
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Open Letter ◽  
Monetary Policy Committee ◽  
Bank Of England ◽  
The Uk ◽  
New Framework ◽  
Policy Committee

It is now just over two years since the new framework for monetary policy was announced and operational responsibility for the setting of interest rates was devolved to the independent Monetary Policy Committee (MPC) at the Bank of England. A key component of the new arrangements is their accountability. One of the ways in which this is meant to be achieved is by the ‘open letter’ system, whereby the Governor is to write to the Chancellor whenever inflation is one percentage point higher or lower than the target. It is remarkable that no open letters have yet had to be written.

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