Mark Carney's comments will not be welcomed in Germany, where there are fears that taxing one part of the Eurozone to pay for another could leave them footing the bill.
ITV News Economics Editor Richard Edgar on the Governor of the Bank of England's comments:
Bank of England Governor Mark Carney praised the European Central Bank for the "boldness" of its plan announced last week to buy hundreds of billions of euros of government bonds to fight the "potentially dangerous" combination of weak growth and falling prices.
But he criticised the eurozone for failing to act on other reforms, including making the single currency area more like the United States, where states cushion one another against economic shocks via federal government transfers.
"It is difficult to avoid the conclusion that, if the eurozone were a country, fiscal policy would be substantially more supportive," he said in a speech in Dublin.
The Governor of the Bank of England launched a broadside against eurozone austerity policies, warning that it was caught in 'a debt trap'.
Mark Carney's comments come as Greece's new Prime Minister confirmed he will be fighting the tight austerity policies placed on the country by the EU.
Since the financial crisis all major advanced economies have been in a debt trap where low growth deepens the burden of debt, prompting the private sector to cut spending further. Persistent economic weakness damages the extent to which economies can recover. Skills and capital atrophy. Workers become discouraged and leave the labour force. Prospects decline and the noose tightens.
As difficult as it has been, some countries, including the US and the UK, are now escaping this trap. Others in the euro area are sinking deeper.
Mark Carney, the Governor of the Bank of England (BoE) has said that inflation is more than likely to fall below 1% over the next six months. Its growth expectations for next year have been cut from 3% to 2.9%.
Bank of England says inflation "more likely than not" to fall below 1% in next 6 months. Economic growth will be slower than expected
Inflation likely to remain close to 1% for next year with pay almost double that, says Mark Carney.
Bank of England Governor Mark Carney said his warning that record-low interest rates will rise sooner than markets expect was "a personal view."
ITV News Economics Editor Richard Edgar reports:
Committee chairman pressing Carney that his Mansion Hse speech which took markets by surprise was a personal view.
It was the intended consequence of your speech to change expectations about the first move on interest rates, Carney is asked: "Absolutely"
Bank of England Governor Mark Carney told MPs there has not been an acceleration in "actual earnings" growth.
He told the Treasury Select Committee, "Since 2008 there's only been six individual months in total where average weekly earnings has been above inflation".
ITV News Economics Editor Richard Edgar writes:
After all the excitement about an imminent rise in rates, Carney tells committee of MPs that the data on wages is still weak[so no need yet?
Calm down everyone: Carney says what matters to borrowers is not the timing of first rate rise but their path: "gradual but limited" rises.
House sellers' asking prices went up 8.9% in the last 12 months, meaning the average property is on sale at a new record high of £272,003.
- In London, asking prices went up 16.3% in the last year
- Compared with 4.9% across the rest of the country
- Ten out of 32 boroughs in London say annual rises of more than 20% - with a 43% increase in Tower Hamlets driven by cash buyers.