The_Guardian_-_2016-12-29

Economic post-traumatic stress disorder
A week after the referendum, Carney said “some monetary policy easing will likely be required over
the summer”, signalling that a rate cut was coming. In a wide-ranging speech he also highlighted a
cocktail of economic, political and geopolitical uncertainty.
“All this uncertainty has contributed to a form of economic post-traumatic stress disorder amongst
households and businesses, as well as in financial markets,” he said.
“Today, uncertainty has meant an inchoate sense of economic insecurity for many people, despite
generalised economic prosperity. Across the advanced economies, employment appears less secure,
wages more subdued, and inequality more pronounced.”
We were right to warn on Brexit
In July, Carney faced questions from parliament’s Treasury committee over whether the Bank had
“peddled phoney forecasts” about the risks of a Brexit vote.
The governor said accusations from critics that the Bank had been dishonest were “extraordinary”.
“We have an obligation to give these assessments. “If we view something as the biggest risk to
financial stability, we have an obligation to parliament and to the people of the UK to make that
clear.”
Time for an interest rate cut
Cutting official interest rates to a record low of 0.25% and expanding the Bank’s electronic moneyprinting
programme to shore up the post-referendum economy, Carney said it was time for action.
“There is a clear case for stimulus, and stimulus now, in order to have an effect when the economy
really needs it.”
Serene about our stance
In September, with the economy continuing to show signs of resilience since the referendum, Carney
rejected criticism that the central bank had overcooked warnings of a hit to the economy from the
Brexit vote. He also defended the Bank’s post-referendum stimulus package.
“I am absolutely serene about the … judgments made both by the MPC and the FPC,” Carney told
parliament’s Treasury committee, referring to the Bank’s monetary and financial policy committees.
Call me Carnage