Monetary Policy

摘要

1. Having initially fallen behind the curve, the Monetary Policy Committee has reacted aggressively to the dramatic deterioration in the outlook by slashing base rates from 5% at the start of October to 1.5% in January. Inflation has fallen back from its September peak and the downward trend is likely to accelerate as demand weakens further and the impact of falling commodity prices continues. Indeed, in his recent letter to the Chancellor to explain why inflation had again overshot the target, Mervyn King remarked that his next letter could be one to explain why inflation had moved more than 1 % below the 2% target.