BoE's Lomax: Mon. stability matters to Merseyside

While there ``almost always'' is a case for waiting, ``we need to be pre-emptive,'' she told a panel of business leaders and journalists in Liverpool, north-west England. ``Any weakness in consumer spending is likely to be temporary.''

The weakness of the euro region, which sucks in about half of British exports, is likely to prove temporary, Lomax said. She noted the risk to world economic growth posed by the current account deficit accumulated by the U.S.

``The risk is that a better balance will only come about through sharp adjustments in exchange rates and a marked increase in U.S. savings,'' Lomax said today. That ``may cause a slowdown in global activity.''

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Speech by Rachel Lomax, deputy governor of the Bank of England, at the launch of the Merseyside Economic Review 2005, The Mersey Partnership, Thursday 24 February 2005.

Click here to read the speech "Why monetary stability matters to Merseyside" on the Bank of England's website