Monetary Policy Committee — Question

Part of the debate – in the House of Lords at 3:22 pm on 6th July 2011.

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Photo of Lord Sassoon Lord Sassoon The Commercial Secretary to the Treasury 3:22 pm, 6th July 2011

My Lords, it is part of the discipline of the way in which the Monetary Policy Committee operates that it is required to write letters to the Chancellor when inflation is outside the target range. The most recent exchange of letters was in May 2011, in which the Chancellor recognised the factors driving short-term inflation, including, particularly, the very high commodity prices. However, it is important to recognise that the MPC's mandate enables it to look through short-term movements in prices towards a medium-term target.