Bank of England forecasting under the spotlight as Committee questions Dr Ben Bernanke
Dr Ben Bernanke will appear in front of the Treasury Select Committee via video link to discuss his recently published review into Bank of England forecasting at 15:05 next Wednesday afternoon.
Meeting details
The independent review of the Bank of England’s forecasting was revealed in an exchange of letters with the Chair of the Treasury Committee in June 2023, following vocal criticism by the Committee of the Bank’s failure to anticipate the trajectory of inflation.
Dr Bernanke published his findings 12 April 2024. In its response, the Bank of England confirmed it was now in the process of developing detailed plans for implementing Dr Bernanke’s recommendations.
Dr Bernanke expressed concerns about the software and models used at the Bank for producing the quarterly forecast and other analysis. He also suggested changes to how Bank Rate forecasts are produced and recommended the Bank should publish selected alternative scenarios to aid their external communications.
MPs are likely to ask Dr Bernanke whether he believes the issues he identified at the Bank of England may have led to preventable mistakes, as well as the extent to which he believes this impacted inflation in the UK.
Given his international experience, the Committee may choose to probe the witness on whether he found evidence of groupthink in the organisation and how he believes the Bank of England is performing when compared with other central banks.