MPC's Dale notes end of 'remarkable' stability

In his first public outing, the Bank of England's new chief economist, Spencer Dale, warned that "a return to theremarkable stability of the past decade may not be in prospect" even when growth resumes and inflation returns to target.

Judging that the upside and downside risks to inflation remain "finely balanced", Mr Dale also seemed to take a gloomier view of medium-term prospects for the economy than did some of his colleagues on the Bank's Monetary Policy Committee.

Mr Dale said that reductions in households' purchasing power " may lead to a deeper and more prolonged slowdown," and spare capacity "could cause inflation to undershoot materially the 2 per cent inflation target."

The house prices adjustment, Mr Dale warned, would be "painful" for many and he predicted a period of "broadly flat" growth.

Although Bank officials deride the way journalists divide MPC members into "hawks" and "doves", the fledgling Mr Dale seems to be developing a remarkably white plumage.