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Home > News and Publications > Summary of Quarterly Bulletin Summer 2006
 

Summary of Quarterly Bulletin Summer 2006

19 June 2006

 

Each article is available as a separate pdf file; click on the appropriate title to access the relevant file. Alternatively you may download the complete issue (5.3mb).

Markets and operations (1mb)
This article reviews developments since the Spring Quarterly Bulletin in sterling financial markets, UK market structure and the Bank's official operations.
 

Research and analysis

Research work published by the Bank is intended to contribute to debate, and does not necessarily reflect the views of the Bank or of MPC members.

House prices and consumer spending (410k)
(By Andrew Benito, Jamie Thompson, Matt Waldron and Rob Wood of the Bank's Monetary Analysis area). This article explores the complex relationship between house prices and consumer spending. It explains that the strength of the relationship can vary considerably over time. And it highlights the key roles that both common factors and causal links have played in the weakening association between house prices and consumer spending in recent years.

Investing in inventories (268k)
(By Rob Elder and John Tsoukalas of the Bank's Structural Economic Analysis Division). As well as investing in capital, firms invest in inventories or stocks. For some businesses, investing in stocks is crucial for their profitability. Shops are better able to attract consumers if their shelves are full and they can offer a wide variety of products. Manufacturers are more likely to win contracts if their customers can trust them to cope with sudden swings in their orders by holding sufficient stocks. Nevertheless, investment in stocks is actually a very small proportion of total spending in the United Kingdom. On average between 2000 and 2005 it was just 0.4% of GDP. But it is volatile. For example, annual GDP growth slowed from 3.1% in 2004 to 1.8% in 2005. Weaker investment in stocks can account for 0.4 percentage points (or a third) of that slowdown. This article examines firms' motives for investing in inventories in order to understand the role it plays in swings in whole-economy output.

Cost-benefit analysis of monetary and financial statistics (181k)
(By Andrew Holder of the Bank's Monetary and Financial Statistics Division). Data collected by the Bank of England from UK banks are used in compiling a range of economic statistics published by the Bank, the Office for National Statistics and other organisations. These data help the Bank maintain monetary and financial stability, and contribute to many other economic analyses. But data collection inevitably imposes some costs on those supplying the information. This article describes a cost-benefit analysis (CBA) framework that has been developed to help balance the demands on data suppliers with the needs of users. It sets out some of the practical solutions employed in applying CBA to monetary and financial statistics and early results of the project.

Reports

Public attitudes to inflation (455k)
(By Colin Ellis of the Bank's Inflation Report and Bulletin Division). Over the past six and a half years, GfK NOP has carried out surveys of public attitudes to inflation on behalf of the Bank of England. As part of an annual series, this article analyses the results of the surveys from May 2005 to February 2006. Public perceptions of past and future inflation picked up recently, while most people thought interest rates had risen over the past year. Public understanding about the monetary policy framework remained limited, but people were generally satisfied with the way the Bank has been setting interest rates.

The Centre for Central Banking Studies (219k)
(By Gill Hammond of the Bank's Centre for Central Banking Studies). This article describes the origins and current activities of the Centre for Central Banking Studies (CCBS) at the Bank of England. The CCBS was set up in 1990 to provide training for central banks overseas. The catalyst for its creation was the increase in demand for such training from former communist countries in transition to market economies. Since then, the CCBS has evolved and today acts as a forum for the study of the analytical and technical aspects of central banking, in order to promote best practice in all central banks. Through the Centre, the Bank of England has relationships with almost all the other central banks in the world; to date, more than 15,500 delegates from 173 central banks have taken part in our activities, in London or abroad.

A review of the work of the London Foreign Exchange Joint Standing Committee in 2005 (123k)
This article reviews the work undertaken by the London Foreign Exchange Joint Standing Committee during 2005.

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