Martin Weale: “I Will Crucify Mankind Upon a Cross of 2 Percent Inflation”
‘It is certainly not self-evident to me in the light of the apparent stickiness of inflation that substantial extra support for the economy would be compatible with the inflation target,’ he explains. ‘I am concerned about the stickiness of inflation.’
He adds: ‘The persistent worry we have is that if people get used to the idea of high inflation, if they take the view that the Bank of England isn’t bothered about the inflation target, it can lead to increased inflation risks and can affect the way in which people negotiate wages and set prices.’
Weale also warns that Britain could suffer an unprecedented ‘triple-dip’ – meaning the economy slides back into recession later this year after the briefest of revivals.
‘I certainly would not say there is no risk of that happening,’ he says. ‘What we have learned over the last four or five years is the capacity of the economy to surprise in ways people might not have thought possible.’
So. We’ve had a “double-dip”, we might even have a “triple-dip”, and it is not “self-evident” to Martin Weale that the economy needs more “support”. Because all that matters is price stability!