Mark Carney: A framework for all seasons?

Speech by Mr Mark Carney, Governor of the Bank of England, at the Bank of England Research Workshop on "The Future of Inflation Targeting", London, 9 January 2020.

Central bank speech  | 
09 January 2020
PDF full text
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 |  26 pages

Introduction

Following a chequered history of high and volatile inflation in the post-war era, the UK finally found monetary success as an early adopter of inflation targeting in 1992. The UK's current regime, launched in 1997, delegated operational independence for setting monetary policy to the Bank of England and included many institutional innovations that have stood the test of time - most notably a Monetary Policy Committee with a mix of internal and external members; transparent, independent voting; and a clear accountability framework.

Since operational independence for inflation targeting was delegated to the MPC, there have been a raft of improvements, both large and small. Transparency has steadily increased with initiatives ranging from publishing detailed assumptions underlying forecasts ex ante to assessing forecast accuracy ex post as well as the simultaneous release of Monetary Policy Summaries, Minutes, and Inflation Reports. More recently, the MPC has introduced layered communications, with simpler, more accessible language and graphics to reach the broadest possible audience, and we have launched the Monetary Policy Report in order to give greater prominence to the most pressing issues shaping each monetary policy decision.