On Monday, Catherine Mann, the newest member of the Bank of England’s Monetary Policy Committee, stated, “Asset prices give vital information regarding the transmission of monetary policy to the real economy and inflation.”
“The link between asset prices and financial stability is also essential for monetary policy considerations.”
“The success of unconventional monetary policies like quantitative easing and negative interest rates is highly dependent on domestic and global economic growth and policy contexts,” says the author.
“According to study conducted in the United States, state-contingent forward guidance was the tool most closely linked to improved financial circumstances.”
“In the case of negative interest rates, they were usually used after other measures, so the marginal effect on financial conditions was minimal.”
“A positive inflation premium on longer-term securities is compatible with a strong economic atmosphere and not a negative signal for markets as long as inflation does not spiral.”
Following these remarks, the GBP/USD pair continued to fall and was last spotted at 1.3670, down 0.75 percent on the day./n
