10:23 AM, 24th November 2021, About 11 months ago
The Governor of the Bank of England confirmed to the select committee that he was not a fan of the bank’s previous forward guidance policy, instigated by Mark Carney.
Forward guidance (hints given externally) of the Bank of England’s economic views led to widespread press anticipation of an interest rate rise at the last MPC meeting. It is well-known economic theory that expectations can influence behaviours and the market, even without being followed up with action.
Andrew Bailey said:”We will keep under review what I would call the boundary between giving the kind of signal that we gave three weeks ago, which essentially said here’s our view of the world this is what follows from it.
“There is an alternative view, which is we should go meeting by meeting and not give any guidance. That is not off the table by any means. That is very well-trodden ground by the MPC and I could imagine us going back to it.”