Inflation, expectations and monetary policy

Citation

Blanchflower D (2008) Inflation, expectations and monetary policy. Quarterly Bulletin - Bank of England, 48 (2), pp. 229-237. http://www.bankofengland.co.uk/publications/Documents/quarterlybulletin/2008contents.pdf

Abstract
In this speech, Professor David Blanchflower, member of the Monetary Policy Committee (MPC), talks about the importance of inflation expectations for monetary policy making. He discusses what has happened to inflation and inflation expectations in recent months, and what actions should be taken in this area in the context of the current conjuncture. He then identifies four distinct phases of the downturn in the United States, and notes a number of similarities with the United Kingdom, suggesting that in the United Kingdom we may see a substantial decline in growth, a pickup in unemployment, and declining consumption growth driven by significant declines in house prices. He emphasises the importance of getting ahead of the curve in order to head off these downside risks.

Keywords
Inflation (Finance); Monetary policy; Fiscal policy; Housing Prices; Risk management in business; Unemployment

Notes
Output Type: Speech

Journal
Quarterly Bulletin - Bank of England: Volume 48, Issue 2

• Blanchflower_2008_Inflation_expectations_and_monetary_policy.pdf