Monetary policy in extraordinary times - speech by David Miles

In a speech to the Centre for Economic Policy Research and the London Business School, David Miles - External Member of the Monetary Policy Committee - discusses the extraordinary economic circumstances that have followed the financial crisis, and the appropriate policy response to the current period of above-target inflation.
Published on 23 February 2011

David Miles begins by explaining how exceptional the current period is in two respects. First, the scale of the reduction in output during the recession is comparable to that experienced during the Great Depression. And second, growth during the recovery is expected to be only at around its trend rate, rather than above it. He says: "This is a very sobering picture; some might call it bleak. Anyway what it is clearly not is a standard textbook cycle when the lost output in the downswing is offset by what happens in the upswing.. This is one aspect of how serious the crisis and its aftermath have been".

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