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Bank of England: How much do they know?

Governor of the Bank of England Mark Carney Photo: PA

Being at the Bank of England's regular press briefing is like stepping into a parallel universe.

The best way to sum up the experience is to tell you that when the Governor Mark Carney was asked the most important question (are higher interest rates now more likely?) his answer was "I don't know".

I kept a careful tally on what else he and his colleagues at the Bank of England don't know:

  • When will wages rise
  • How much real "slack" is there in the UK economy
  • How the housing market will go

There is a belief that the only reason economists exist is to make astrologers look accurate. That being the theory, it may be best that the Governor steers away from predicting the future. It means we must not expect too much clarity in warnings from the Bank on when our interest charges are going to rise.