Focus on jobs more than inflation, says Bank exec

PROTECTING jobs is more important than fighting inflation in the wake of the Brexit vote, according to a deputy governor of the Bank of England.

Ben Broadbent signalled that policymakers would continue to keep interest rates low unless signs emerged that the referendum result had damaged the UK’s medium-term growth prospects more than currently anticipated.

Mr Broadbent said policymakers were prepared to tolerate the most sustained overshoot of the Bank’s 2pc inflation target since inde- pendence in 1997 because raising interest rates to keep a lid on price rises would do more damage to the economy.

“We can tolerate high inflation because the alternative is a larger rise in unemployment, and weaker wage growth,” he said in a speech in London.

The Bank’s deputy governor for monetary policy also rejected the idea that central banks had driven a rise in inequality.

Echoing Mark Carney, the Bank’s Governor, he said that the “evidence” showed income inequality had been “broadly unchanged since real interest rates began to decline a quarter of a century ago”.

He said the idea that “looser” and “unconventional” monetary policy was “having material and lasting effects on the distributions of income and wealth” was not supported by the data and added the biggest driver of wealth inequality had been the surge in house prices either side of the millennium.