They also give no hint as to why rates will be rising in the next few years, when there seems little chance of that around the world with Fed, ECB and Bank of Japan policy as it is, so why they think the UK will be so out of line is hard to imagine.
Mebbe that MMT insistence that inflation only arrives with full employment isn’t quite as secure as some think?
Even, that the definition of full employment changes according to the underlying microeconomic structure of the economy?
That is, inflation comes back when recovery is less than complete and we face a choice of raising interest rates orm instead, increasing taxation, to stop the inflation. Which should we choose?
This report from the IFS is not objective in that case. Nor is it fair comment: it is simply a reflection of the obsession fo a bank with increasing interest rates, for which there is no justification, or need. And it is a reflection of the desire of that bank to suggest that bond markets are still in charge of those rates, when they are not. And it is a reflection of the desire of that bank to suggest that what we need is independent control of monetary policy, irrespective of fiscal policy, so that bankers have the best chance of delivering those increases in rates in the interests of bankers but not the economy as a whole.
This report has, then, to be read not as any form of objective review, bit simply as a manifesto for neoliberal policies that maintain the status quo in the interests of the banking community of the UK. The fall of the Institute for Fiscal Studies from any sort of credibility is just about complete. They are instead simply a cover for the wealthy to demand the policies that they desire.
Oh, apparently not then.