Forward Guidance II: does Carney's policy hold water?

Not everyone is convinced by BoE governor's efforts to clarify his intentions on interest rates

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Mark Carney's "run of luck" as Bank of England governor "shows no signs of ending", says Emily Cadman in the Financial Times. This week's drop in inflation to a four-year low of 1.9 per cent comes on the back of "buoyant" growth numbers and falling unemployment.

Add in sterling's appreciation, which has helped the inflation outlook by reducing the cost of imported goods, and the Bank's chances of keeping interest rates low for a prolonged period "look good". As economist Andrew Goodwin of the EY Item Club observes: "With inflationary pressures subdued, the Bank will be able to wait until it has seen evidence of a sustained pickup in real wages and greater balance to the recovery", before it needs to fire the starting gun.

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