Huw Pill: UK monetary policy outlook

Speech by Mr Huw Pill, Chief Economist and Executive Director for Monetary Analysis of the Bank of England, at the Money Market Association of New York University (Money Marketeers) Event, New York City, 9 January 2023. 

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

Good evening everyone.

Before I turn to the body of my remarks, I thought it would be useful to start the New Year with a few important reminders.

Inflation in the United Kingdom is currently too high. Returning UK inflation to its 2% target on a lasting and sustainable basis is essential. Price stability must prevail if we are to create the environment in which firms and households can take the longer-term investment decisions that build the human and physical capital, which ultimately drives the dynamism, innovation, productivity and growth upon which prosperity and improving living standards rest.

It is the job of monetary policy to return inflation to target. That is what we on the Bank of England's Monetary Policy Committee (MPC) are mandated to do within the UK's institutional framework for macroeconomic policy. In the face of inflationary shocks over the past eighteen months, the MPC has tightened monetary policy significantly.

The Committee will continue to act as necessary to ensure the inflation target is achieved on a lasting basis over the medium term, remaining alert to new economic shocks that might create further inflation disturbances.