Monetary Policy - Monetary Policy Committee
Worksheet 2 - Inflation - the Monetary Policy Committee (MPC)
The aim of this worksheet is to look at the work of the Monetary Policy Committee (MPC) and the MPC process and how they go about setting interest rates to control inflation.
1. How many members of the MPC are there?
2. In the table below, fill in the names of the current members of the MPC in the first column. In the second column indicate whether they are members from within the Bank of England or whether they were appointed by the Chancellor of the Exchequer. Finally, in the last column put a tick by the person who chairs the committee. Use the Bank of England Web site to find out this information.
| Committee member | Bank member or appointed by Chancellor? | Chair? |
|---|---|---|
3. How often does the MPC meet?
4. What is the current inflation target?
5. Why is the target called a symmetrical target?
6. What happens if the target is missed by more than 1% either side?
7. How long may it take for interest rate changes to have their full effect on inflation?
8. Use the In The News archive to look up recent stories and issues concerning the MPC and monetary policy. Write a summary below of what you have found.
You may want to search on terms like:
- Inflation
- Retail Price Index
- Monetary Policy
- Fiscal Policy
- MPC
- Bank of England
N.B. When searching on search terms with more than one word it may be helpful to check the 'Match your phrase exactly' box to limit the search results.
