MNI BRIEF: BOE Broadbent Rejects Pre-announcing Rate Hikes

It would be a mistake for policymakers to pre-announce rate hikes, Bank of England Deputy Governor Ben Broadbent argued in a Q&A session Wednesday.

Pre-committing to a hike entails giving up a period of time in which policymakers are free to respond to economic developments and "Why give up a month, a quarter of discretion just for the sake of pleasing a few people in the financial markets?"

Broadbent said he had some sympathy with the idea central bankers should sometimes just "shut up". He also weighed against the idea of setting out a plan to raise interest rates to, or above, R-star, the interest rate that stabilizes the economy saying that "it is not an independent guide to how we set policy now," but rather something they can assess in retrospect.