Money Matters: Bank of England deliver policy briefing at South Eastern Regional College

Michael Saunders, a Member of the Bank of England’s Monetary Policy Committee was in Northern Ireland on Wednesday 15 January to speak to business leaders about the economy and the Bank of England’s Monetary Policy.   The breakfast session, held at South Eastern Regional College’s SPACE Campus in Bangor, was attended by business leaders from a range of sectors including start-ups and included students from the College’s Entrepreneur Club and student enterprises.

Mr Saunders summarised his speech ahead of finer detail and said,

“First, with softer global growth and high Brexit uncertainty, the UK economy has remained sluggish. The slowdown has created a modest output gap, and there are signs that the labour market is turning.

“Second, the most likely outlook is a further period of subdued growth, and hence a disinflationary backdrop of a persistent – albeit modest – output gap.

“Third, the neutral level of interest rates may have fallen further over the last year or two, both in the UK and externally.

“Fourth, against this backdrop, it probably will be appropriate to maintain an expansionary monetary policy stance and possibly to cut rates further, in order to reduce risks of a sustained undershoot of the 2% inflation target. With limited monetary policy space, risk management considerations favour a relatively prompt and aggressive response to downside risks at present.”

Mr Saunders took time to meet enterprise students at the College and was encouraged to hear about the range of businesses being developed through SERC’s Project Based Learning and the Entrepreneur Club.   He wished the students every success with their ventures.

You can download a full copy of Mr Saunders speech delivered at the College here.