David Prosser: Which way will the MPC jump?
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Outlook Another month, another meeting of the Monetary Policy Committee – and, in all likelihood, another announcement of no change to the policy on interest rates and quantitative easing. Chances are that the minutes of the latest meeting will reveal that the committee remains torn between its nervousness about an anaemic recovery and its worry that inflation remains too high.
In which case, it will be tempting to draw parallels between Andrew Sentance, the MPC member who has been in a minority of one in arguing for an early rate rise, and David Blanchflower, one of his predecessors on the committee. He spent months urging all his fellow MPC members to cut rates ahead of the recession before ultimately being proved right.
There is an argument to be made for Mr Sentance's view that early action is necessary to prevent inflation expectations from becoming entrenched. But the difference between his situation and that of Mr Blanchflower's is that while the latter's argument was backed up by greater volumes of data every month, the reverse is true this time: inflation has finally begun to tick downwards.
Indeed, the almost exclusively gloomy data we have had in recent weeks on everything from services to house prices should leave the MPC in no doubt about the way to go. With respect to Mr Sentance, the case for more monetary stimulus becomes stronger by the day.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments