Monetary Policy Difficult to Manage in Fog of Official Data

Embargoed for 00.01 hours, Tuesday 28 October 2003

The Shadow Monetary Policy Committee (SMPC), the long standing group of distinguished economists that meets quarterly at the , voted to keep interest rates on hold at its October meeting. The decision was made difficult given the poor quality of the official data provided by the ONS; the weak supply side of the UK economy that is underpinned by strong borrowing; and conflicting views on the world economic outlook.

Developments in the world economy did not provide any clear signals for the UK. OECD growth looked steady but recovery in the US is still tentative, and potentially fragile given the level of US government borrowing. However, world economic growth outside the OECD is strong.

Recent revisions to UK economic sta