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Carney could scrap 2% target

Carney could scrap 2% target
The incoming Governor of the Bank of England has mooted the idea of scrapping the UK’s inflation target if growth does not strengthen.

Mark Carney, who will take over from Sir Mervyn King at the Bank next summer, said in a speech on Tuesday that if more stimulus was needed to boost growth, inflation targets may need to be dropped.

However he also warned that implications of such a move would need to be carefully considered.

“[Any new plan] would have to be weighed carefully against the effectiveness of other unconventional monetary policy measures under the proven, flexible inflation targeting regime,” he said.

Green Box: Carney could scrap 2% targetClick to open

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