BoE's Dhingra
- There is no doubt that inflation, whilst beginning to ease off its peak last year, is still far too high relative to our two per cent target
- Monetary policy's effects on inflation are not immediate due to transmission lags, necessitating careful economic monitoring to adjust the stance in the medium term.
- The improved collection of mortgage data aids in understanding monetary policy's influence on the housing market.
- Despite the overall effectiveness of policy transmission to retail borrowing rates, the current cycle is likely to be slower due to a high stock of fixed-rate mortgages, which delays the effects of a higher Bank Rate.
- Current economic data suggests a slow recovery from major supply shocks, accompanied by ongoing hardship for the most disadvantaged in society.
- Monetary policy, although unable to directly address structural and distributional issues, aims to sustainably return inflation to target in the medium term, and developing a robust data and analytic infrastructure is essential for understanding and addressing transmission of shocks.
Swati Dhingra, a Bank of England Monetary Policy Committee member, speaks about a collaboration on the Economy 2030 Inquiry for strategizing UK's urban economic growth. She highlights inflation concerns, emphasizing on data innovations for facilitating policy decisions. She addresses challenges in understanding the globalized, fragmented economy, particularly services and supply chain dynamics, affecting price inflation measurements. Noting UK's global trade value and economic impacts from global events, she discusses economic performance and living standards. The relationship between producer and consumer price inflation is explored, with focus on the impacts of supply chain operations and price setting.
