MPC minutes to be released sooner

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The Independent Online
THE BANK of England's Monetary Policy Committee (MPC) has decided to publish the minutes of its monthly interest rate-setting meeting just two weeks after the meeting takes place, rather than five to six weeks, a move which met with mixed reaction in the City.

The decision to bring forward publication of the minutes - which explain in detail the MPC's reasoning - follows pressure from the Treasury Select Committee.

The Committee, chaired by Giles Radice MP, argued that early publication of the minutes was important on two counts. First, it would help the markets understand MPC thinking sooner. Second, it would improve accountability. Under the old timetable, Select Committee members were frequently unaware of the full voting record of the MPC members who were called to appear before them.

Mr Radice said yesterday: "I am very pleased at the decision. A fortnight is about right, as the committee was concerned not to lower the quality of the minutes."

However, not all economists agreed with the decision, arguing that early publication of the minutes could increase market volatility. Neil Parker at Royal Bank of Scotland said: "We are disturbed by the news. Swings in MPC voting patterns have been such that, on at least two occasions this year, earlier publication of the minutes would have suckered the markets into believing the next rate decision would have been different to the decision we got."

In his letter to Mr Radice, Eddie George, Governor of the Bank of England, said the MPC had considered carefully whether earlier publication of the minutes would give rise to greater market uncertainty.

He concluded: "Our experience since 1994, when we started publishing the minutes of the Chancellor-Governor meetings, does not suggest that this is likely to occur at all frequently."