BOE Currency ‘Mismanagement’ Stoked Inflation, Schneider Says

The Bank of England’s Monetary Policy Committee is faced with volatile inflation because of its reluctance to allow the pound to appreciate, according to Schneider Foreign Exchange.

“The MPC’s mismanagement of the exchange rate is the primary reason why it has had limited, if any success at all, in guiding inflation expectations to where they are supposed to be,” Stephen Gallo, head of market analysis in London, said today in an e-mailed note. “It is unlikely that a moderately higher value of the pound and/or bank rate would have done much damage to the pace of growth in U.K. output.”