LONDON (Reuters) - The Bank of England should do more to show the public how its decisions help them in order to improve understanding of monetary policy, the central bank’s chief economist Andy Haldane said on Tuesday.
Haldane said the BoE’s actions since the onset of the financial crisis - slashing interest rates to historic lows and creating hundreds of billions of pounds to buy government bonds - had benefited British households.
But he noted many members of the public think lower interest rates have left them worse off, despite evidence showing very few households lost out as a result of the BoE’s decisions.
British Prime Minister Theresa May said in 2016 that low interest rates had bad side effects.
“My view is that there is a strong case for making, on a periodic basis, comprehensive and transparent assessments of the distributional impact of monetary policy,” Haldane said in a speech due to be delivered in Melbourne, Australia.
Haldane said the BoE’s actions since 2007 had helped people across the full range of income and wealth, age and region, although different groups of people had benefited in different ways - for instance through employment income or wealth.
To aid public understanding, Haldane suggested the BoE could produce a personalized scorecard to show how its policy was affecting individuals.
“Some scorecard-like device could, at times of significant change in the monetary policy stance, help explain, in simple terms, the personal as well as societal benefits monetary policy confers,” Haldane said.
“This should help make monetary policy relevant to people’s everyday lives.”
Reporting by Andy Bruce; Editing by William Schomberg