Bank Rate maintained at 3.75% - April 2026 Monetary Policy Summary and Minutes
The Bank of England’s Monetary Policy Committee is responsible for making decisions about Bank Rate.
Central banks
Exchange of letters between the Governor and the Chancellor regarding CPI Inflation - April 2026
Exchange of letters between the Governor and the Chancellor
Messaging to a public with its own view on central bank confidence
We model central bank communication when there is disagreement between the markets and the central bank about the central bank’s confidence surrounding its point forecast. We show that such a disagreement leads the markets to misunderstand a given announcement, so that the markets either over- or underreact to the bank’s announcement. Communicating only a part of the central bank’s information set is a way to correct the markets’ over- or underreaction.
Bank to non-bank lending and the reallocation of credit
We analyze how bank lending to non-bank financial institutions (NBFIs) affects credit supply to the real economy. Using granular supervisory and loan-level data, we document rapid growth in bank lending to NBFIs relative to lending to non-financial firms. This growth is driven primarily by reverse repos to NBFIs that invest in securities, e.g., investment funds, rather than by loans to NBFIs that extend credit to firms, e.g., private credit funds.
Quantile selection in the gender pay gap
We propose a new approach to estimate selection-corrected quantiles of the gender wage gap. Our method employs instrumental variables that explain variation in the latent variable but, conditional on the latent process, do not directly affect selection. We provide semiparametric identification of the quantile parameters without imposing parametric restrictions on the selection probability, derive the asymptotic distribution of the proposed estimator based on constrained selection probability weighting, and demonstrate how the approach applies to the Roy model of labor supply.
Monetary policy without an anchor
Policymakers often cite the risk that inflation expectations might “de-anchor” as a key reason for responding forcefully to inflationary shocks. We develop a model to analyze this trade-off and to quantify the benefits of stable long-run inflation expectations. In our framework, households and firms are imperfectly informed about the central bank’s objective and learn from its policy choices. Recognizing this interaction, the central bank raises interest rates more aggressively after adverse supply shocks and accepts short-run output costs to secure more stable inflation expectations.
Monetary policy under multiple financing constraints
We revisit the credit channel of monetary policy when firms face multiple financing constraints, a common feature of corporate financing we document empirically. Our theory shows that the multiplicity of constraints dampens the transmission of expansionary policy to firm borrowing and investment notably but amplifies the transmission of policy tightening. This asymmetry arises because, when policy tightens (eases), the most (least) responsive constraint binds. Using U.S.
Dynamic credit constraints: theory and evidence from credit lines
We use a comprehensive Swedish credit register to document that firms across the size distribution have access to substantial borrowing capacity via credit lines. However, most firms choose not to use all available credit, even though interest rates are low compared to their return on equity. The low utilization of credit is consistent with a theoretical model in which utilization rates decrease with both real and financial uncertainty.
Who owns crypto in the euro area? Drivers of crypto adoption, payment use, and its interaction with fiat cash
Using a survey of 39,507 adults in 17 euro-area countries, I find that crypto-asset owners and the niche subgroup of payers have distinct profiles. Owners – typically younger, male, and financially active – exhibit mixed preferences, valuing both cash-like privacy and card-like speed. Crypto payers display a cash-centric profile, seeking to replicate physical cash’s privacy and ease of use in digital form.
Green supply chains at risk: measuring the true economic and environmental costs
Our new methodology builds an inter-country input-output table that distinguishes green products from the rest, allowing us to assess vulnerabilities in green value chains. In a multi-country, multi-sector model, our table reveals that a decoupling of green supply chains between a US-centric West and a China-centric East could globally cut trade in green products by up to 20%, lower welfare by up to 3% and raise yearly global greenhouse gas emissions by about 50 million tonnes.
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