"It has an important role to play in cushioning the effects of any relapse in recovery in the months and quarters ahead and, beyond that, in helping making the future recovery everyone’s."
In a speech today, Haldane said: "This monetary response, if it is to buttress expectations and confidence, needs I think to be delivered promptly as well as muscularly. By promptly I mean next month, when the precise size and extent of the necessary stimulatory measures can be determined as part of the August Inflation Report round."
He said that the minutes of the latest MPC meeting, released yesterday, were "broadly consistent" with his personal view, highlighting the statement that "most members of the Committee expected monetary policy to be loosened in August”.
However Haldane admitted, like Carney in a recent speech, that "monetary policy cannot do everything to counter the impact of the referendum".
He added: "Monetary policy of course needs to be mindful of the potential adverse consequences of administering ever-larger doses of the monetary medicine. Nonetheless, my personal view is that it has an important role to play in cushioning the effects of any relapse in recovery in the months and quarters ahead and, beyond that, in helping making the future recovery everyone’s."
Haldane believes that the Referendum result has "increased materially the degree of uncertainty – economic, policy, and political – around the UK’s economic recovery", with a "good chunk" likely to linger throughout the Bank’s two to three-year policy horizon.
He added that the uncertainty will "weigh on domestic spending by both companies and households for the foreseeable future".
Haldane concluded: "Even though the economy is unlikely to crash, it is likely to slow, perhaps materially, in the quarters ahead. While companies and consumers might not be slamming on the brakes and going into reverse, as in 2008, some are likely to be going down a few gears, perhaps even moving into neutral."
