New Bank of England Monetary Policy Committee (MPC) member Ian McCafferty believes that the central bank ought to keep an 'open mind' on the use of further non-standard measures, or remain 'open to the use of unorthodox means' to use his own words. Those remarks followed on a question posed to him regarding the relative merits of targeting nominal GDP.

On the question of the exchange rate of Sterling, he said that competitive devaluations can be 'self-defeating' and reminded listeners it could serve to stoke inflation, although it remains to be seen if the exchange rate is yet at the correct level or not. In that same vein, he went on to explain that he does not hold a strong view on whether it should rise or fall.

Speaking in an interview with Bloomberg TV he added that: "the lacklustre performance of exports has as much to do with weak growth in what are currently the main export markets of the UK and the lags involved in establishing a foot-hold in new and faster growing economies."

As regards the purchase of debt issued by small and medium sized enterprises, he believes the monetary authority should keep the debate alive.

Mr.McCafferty is to give his first speech as a MPC member at noon. The text will be released on the BoE website.

AB

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