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City A.M. | Shadow mpc

ALLISTER HEATH | CITY A.M.
“Suspend QE, for the time being at least. A strong signal should be sent that a symbolic rate rise is imminent. It is hard to work out what is happening to liquidity but there seems to be enough of it at present.”

SIMON WARD | HENDERSON
“Stop QE and prepare markets for a spring rate rise. Inflation is unlikely to return to target on current settings. Money supply weakness is offset by rising velocity. The output gap is smaller than thought and already closing.”

HOWARD ARCHER | IHS GLOBAL INSIGHT
“Recovery is proving difficult to establish while inflation is surprising on the upside. I would stop quantitative easing this month but leave the door open for more in case of marked economic relapse.”

GEORGE BUCKLEY | DEUTSCHE BANK
“The recovery may be slow, but sizeable stimulus packages should eventually push growth higher. As a result, both interest rates and quantitative easing should be maintained at their current settings.”

GRAEME LEACH | INSTITUTE OF DIRECTORS
“Both rates and QE need to stay on hold. The weakness of broad money growth raises questions about the sustainability of the recovery. We’ve had an abnormal recession and we may well get an abnormal recovery.”

VICKY REDWOOD | CAPITAL ECONOMICS
“The MPC is likely to pause, caught between a sluggish recovery and rising inflation. But I would extend QE again – the economy still needs more support and the rise in inflation is likely to be only temporary.”

MICHAEL SAUNDERS | CITIGROUP
“The MPC are likely to suspend QE, leaving intact the existing £200bn stimulus but no longer buying gilts. As inflation picks up further, the MPC are likely to make a rapid turnaround from stimulus to tightening.”

JAMIE DANNHAUSER | LOMBARD STREET RESEARCH
“The money supply is now contracting outright. Given the perverse regulatory pressure on banks to raise capital ratios while the economy is still fragile, the MPC has more work to do. Extend QE by £25bn.”

TREVOR WILLIAMS | LLOYDS TSB
“If QE is withdrawn too soon there is a serious risk of relapse in the recovery. The recent rise in inflation should be ignored as it will prove temporary. There is no reason why monetary policy cannot stay loose.