Rebalancing the supply side of the UK economy: what; how; and issues for monetary policy

In a speech to mark the centenary of the Department of Economics at the University of Aberystwyth, Spencer Dale – Bank of England Chief Economist and member of the Monetary Policy Committee (MPC) – discusses the imperative of rebalancing the supply side of the UK economy, and explains why this process poses significant challenges for UK monetary policy.

Published on 20 March 2012

Changes are required in the pattern of UK spending, but such changes cannot be enough on their own, Dale insists. The types of goods and services that the UK produces must also shift, in order to match the re-orientation of demand. And it is this supply-side leg of rebalancing that he fears may prove “more difficult and potentially more disruptive” for the economy.

Press release