Foreword by the Governor of the Bank of England
It gives me great pleasure to welcome you to Target Two Point
Zero - the Bank of England/Times Interest Rate Challenge. We
introduced the Challenge in 2000 to give students a practical
understanding of the way the economy works and an insight into
how the Bank's Monetary Policy Committee goes about its task
of achieving the Government's inflation target. We have been
delighted by the enthusiastic response of students and teachers
alike. I hope that you will enjoy taking part in the Challenge
as much as your predecessors.
The competition offers students a great opportunity to broaden
their understanding of monetary policy and how it relates to
the economy as a whole. You will learn about how interest rates
affect inflation and what matters when making interest rate
decisions - what information the Monetary Policy Committee uses
and how judgements are formed. And, of course, you will have
the chance to have a go yourselves and tell members of the Monetary
Policy Committee what interest rate you would set - and why.
There will also be ample opportunity to develop and demonstrate
key skills, which are now an important part of post-16 education.
There will be no right or wrong answers - there never are. The
Challenge is to demonstrate your understanding, present a well-argued
case for your interest rate decision and then answer the judges'
questions convincingly. All the necessary information will be
provided in a resource manual and on these specially designed
pages on the Bank's website, but you can use other information
if you wish. Finalists will be guests of the Bank of England
in London for the two days of the national final and the winning
team will receive the Bank of England/Times Interest Rate Challenge
trophy and a substantial cash prize for their school.
May I take this opportunity to encourage you to take part in
the Interest Rate Challenge. I look forward to the eighth national
final in London in March 2008. I hope that you will always feel
that taking part in Target Two Point Zero was worthwhile and
rewarding.
Mervyn King
Governor, Bank of England
