BOE 'Has No Good Choices,' Has to Raise Rates, Posen Says

The video discusses the Bank of England's dilemma in managing inflation and interest rates amidst Brexit uncertainties. It highlights the potential impact of a Brexit transitional deal on economic policy and the risks of inflation if the deal fails. The Bank faces tough choices between stabilizing the economy and controlling inflation, reminiscent of challenges from the 1970s and 80s.

What is the main concern of the Bank of England regarding inflation?

• Currency appreciation

• Deflationary pressures

• Inflation expectations becoming unanchored

• High unemployment rates

How does Brexit complicate the Bank of England's policy decisions?

• It stabilizes the currency

• It creates uncertainty in economic forecasts

• It leads to increased foreign investments

• It reduces inflation

What could happen if the UK does not secure a transitional deal with the EU?

• Lower inflation rates

• A smooth economic transition

• A significant policy shift

• Increased foreign trade

What are the potential consequences of a Brexit transition breakdown for the Bank of England?

• Cutting rates and risking inflation

• Increasing foreign investments

• Reducing interest rates without risks

• Stabilizing the economy effortlessly

In the event of economic challenges similar to the 1970s, what is the Bank of England's dilemma?

• Ways to reduce unemployment

• How to increase inflation

• Whether to cut rates or maintain stability

• Methods to boost exports