Tuesday, September 2nd15.9°C
22817
22916

Carney's Canadian approach in England

Mark Carney is already causing ripples in Britain in his first week as governor of the Bank of England, even though his methods would be considered old hat in Canada.

Eschewing past practice, the British central bank went beyond simply announcing no changes to the 0.5 per cent key interest rate as it also published a statement explaining the reasoning and suggesting rates would remain depressed for some time.

The dovish statement had the effect of boosting equity prices in England and dropping the pound one cent to $1.51 US.

Under the previous governor, Mervyn King, the bank would typically issue no comment when policy was left unchanged.

But instead the central bank gave some indication where matters are heading by declaring that "the implied rise in the expected future path of bank rate was not warranted by the recent developments in the domestic economy."

It also said it would provide an assessment next month to Treasury chief George Osborne on whether the bank should use forward guidance, a tool Carney introduced in Canada in the spring of 2009 to give markets and investors long-term assurance on interest rate expectations.

"It does appear that the committee are already moving towards more communication on their decisions and towards providing forward guidance on monetary policy," said Howard Archer, IHS Global Insight's chief U.K. and European economist.

Alistair Cotton, a senior analyst with Currencies Direct, said any forward guidance on interest rates would be "warmly greeted by homeowners (with variable mortgages) ... who will be in a better position to budget and even forecast the right time to lock in."

 

The Canadian Press


Read more Business News

20759


Recent Trending




Today's Market
S&P TSX15607.51-18.221
S&P CDNX1015.68-8.31
DJIA17043.10-55.35
Nasdaq4584.183+3.911
S&P 5001998.04-5.33
CDN Dollar0.9153-0.0041
Gold1287.40-3.30
Oil95.96+1.29
Lumber349.80+1.40
Natural Gas4.116+0.014

 
Okanagan Companies
Pacific Safety0.20+0.005
Knighthawk0.01-0.005
QHR Technologies Inc1.190.00
Cantex0.08+0.01
Anavex Life Sciences0.250.00
Metalex Ventures0.07-0.005
Russel Metals36.44-0.04
Copper Mountain Mining2.91-0.02
Colorado Resources0.17-0.01
ReliaBrand Inc0.10+0.001
Sunrise Resources Ltd0.0250.00
Mission Ready Services0.225-0.02

 



21313

FEATURED Property
1886883108-770 Rutland Road
2 bedrooms 2 baths
$217,900
more details
image2
Click here to feature your property
Please wait... loading


Manage your behaviour

You can’t manage what you can’t control! You can’t manage the number of sales you’re going to make but you can manage the behaviour that will help you make those sales. Obvious...


At the Core: Lessons in pricing from Apple

Apple has taught many entrepreneurs the importance of design, how to create buzz when introducing new products to the marketplace, how to pioneer new technology and the importance of superior quality....


New Real Estate Brokerage in town

Move over “big guys” there’s a new brokerage in town featuring local expertise, long standing experience and a fresh boutique approach. Kelowna, August 31 2014 – You may have...

_



22692

22692


Member of BC Press Council


22810