LONDON (Reuters) – The Bank of England has a lot to learn from the recent surge in inflation – which outstripped the central bank’s forecasts – in order to prepare for future shocks that will hit Britain’s economy, the head of the BoE’s oversight board said on Tuesday.
“We think there are lessons to learn…. We need to stand back and ask ourselves what can we learn,” David Roberts, chair of the BoE’s Court of Directors, told lawmakers in the House of Lords who are looking into the Bank’s operational independence.
Governor Andrew Bailey struck a similar note last month and chief economist Huw Pill has said there were errors in the way the BoE made its forecasts for inflation which surged to above 11% last October and remained close to 9% in April.
Roberts told the Economic Affairs Committee in the House of Lords that he had instigated a review of the forecasting process which had been “readily agreed to” by Bailey and other top policymakers at the central bank.
“We’ll have lots more shocks that we need to prepare for,” he said.
(Writing by William Schomberg; editing by David Milliken)
