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MPC Explains Rationale Behind Forecast Changes

BOE
Q: On magnitude of change in forecasts.
  • A: In early November, energy outlook was very bleak and was reflected in pricing. Second piece of news - taken into account Budget. Third, global conditions improved - impact of China's ending of zero covid policy much quicker than expected. Fourth, economy more resilient.
  • But have to look at change and level - it's still very weak growth.
  • Broadbent: These are conditional forecasts, so when conditions change, forecasts change. Energy price changes have been huge.
  • Ramsden notes that the change in energy prices has been a positive shock to the economy. But notes that this is against a backdrop of very weak growth.

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