Huw Pill: Monetary policy with a steady hand

Speech by Mr Huw Pill, Chief Economist and Executive Director for Monetary Analysis of the Bank of England, given at the Society of Professional Economists online conference 2022, 9 February 2022.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Central bank speech  | 
11 February 2022
by Huw Pill
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  |  20 pages

Good afternoon everyone.

It is a great pleasure and honour to speak at today's Society of Professional Economists conference. Thanks to George Buckley and his fellow organisers for the invitation to participate.

Last week's MPC decision

Let me start with last week's MPC decision.

As you all know, the MPC decided to raise Bank Rate by 25bp to 0.5%. The Committee also agreed to commence the unwind of gilt holdings accumulated through quantitative easing (by ending re-investment of maturing bonds), as well as announce an intended unwind of the corporate bond portfolio.

This further withdrawal of the monetary policy accommodation introduced at the outset of the pandemic was motivated by a forecast with three important and inter-related elements, which I will address in turn.