LONDON (Reuters) - Bank of England Governor Mark Carney and other British monetary policymakers are speaking at a news conference after the Bank published its quarterly Inflation Report.
Below are comments from the news conference.
CARNEY ON FORWARD GUIDANCE
"Forward guidance is working: expected interest rates have remained low even as the economy has recovered strongly, uncertainty about interest rates has fallen, and most importantly, UK businesses have understood the message."
"The objective is not to have forward guidance forever. (It) is to have a recovery that moves into an expansion that is a... sustainable and balanced expansion. That is the objective."
BEAN ON TIMING OF TIGHTENING
"You would want to start tightening policy before slack is completely eliminated simply because of the lags between changing monetary policy and its impact on activity.
"If you leave it until slack has closed, that's a recipe for going too far, if you like."
CARNEY ON SPARE CAPACITY
"We want to eliminate spare capacity over the forecast horizon. For the first time we are being clear about our assessment of the degree of spare capacity."
CARNEY ON FUTURE RATE RISES
"When the point comes, and there will be many conversations between now and that point and lots of communications, ... the adjustments in rates will be gradual and they will be limited."
CARNEY ON EMPLOYMENT THRESHOLD
"If we had perfect information about what we would have seen in the economy then as we do now, we would have had a greater sense of the degree of slack in the labor market that we've seen.
"That might have had some bearing on where we had set the threshold. But of course we didn't.
"If I knew then what (we know now)... absolutely would have had a threshold providing a very clear, clean simple message to businesses."
CARNEY ON EVOLVING GUIDANCE
"The first phase of guidance gave businesses confidence that bank rate would not be raised at least until jobs, incomes and spending were growing at sustainable rates. As guidance evolves that remains the case.
"The MPC will not take risks with this recovery."
"I am very comfortable with what we have done (on forward guidance), I shouldn't speak for other members of the Committee, but I think there is strong support for that we have done."
DALE ON EARNINGS GROWTH
"We expect real earnings to go positive hopefully sometime in the second half of this year. Although that does depend in part on the pick-up in productivity coming through."
CARNEY ON UNBALANCED RECOVERY
"The recovery as yet is neither balanced nor sustainable. A few quarters of above trend growth driven by household spending are a good start but they aren't sufficient for sustained momentum."
CARNEY ON DISPOSABLE INCOMES
"If you look at disposable income per head, which is more our preferred measure for forecasting,... we do expect a turn in those this year."
CARNEY ON LONG-TERM RATES
"I wouldn't be a pessimist about the ability to return to the type of rates that historically had been associated with periods of price stability and reasonable productivity growth, but that is... well beyond the (BoE's) forecast horizon."
CARNEY ON INFLATION EXPECTATIONS
"We have inflation expectations at least as well in fact, more well anchored than they were in August... We are starting from a good position as we sit here in February. A much better position than we were in August."
CARNEY ON PRODUCTIVITY
"Productivity is notoriously difficult to measure and it's difficult to forecast. What we have done with this forecast is we have been more cautious in our assessment of productivity growth: productivity does not get back to its pre-crisis trend until three years from now, until the end of the forecast."
CARNEY ON DOWNSIDE RISKS
"The pick-up in business investment is still in its earliest stages and the global outlook, although improved in the advanced world, entails downside risks in emerging markets."
CARNEY ON INTEREST RATES
"Persistent headwinds mean that even in the medium term the level of interest rates necessary to sustain low unemployment and price stability will be materially lower than before the crisis."
CARNEY ON RECOVERY FACTORS
"The recovery to date has been underpinned by a revival in confidence, a reduction in uncertainty and an easing in credit conditions.
"This has led to households to save less and spend more and has prompted a strengthening in the housing market."
"While business investment has so far been subdued, recent data and survey suggest that (the recovery) is likely to gather pace this year."
CARNEY ON CURRENT ACCOUNT DEFICIT
"The MPC has... discussed the size of the current account deficit. And obviously there's an element of that which is on the trade side and it's the weakness in Europe. It does underscore the importance of productivity picking up."