Explaining the consumption gap: Keynote speech by External MPC member Dr. Catherine L. Mann

In recent years, UK households have faced a number of economic challenges, contributing to subdued growth and increased living costs. These pressures have been particularly noticeable during the period of elevated inflation following the pandemic, and higher interest rates in response. These conditions have influenced household finances and behaviours, which affects how policymakers seek to shape the monetary policy environment.

In a keynote speech at the Resolution Foundation, External Member of the Bank of England’s Monetary Policy Committee Dr. Catherine L. Mann will discuss how the recent episode of above-target inflation and higher interest rates have affected households’ consumption, savings, and financial behaviour. As part of that assessment, she will also consider how above-target inflation tends to be associated with higher volatility and uncertainty, and what that means for households’ decisions.

Following Catherine’s keynote address, we will hear a response from former MPC member Michael Saunders before both panellists take part in a Q&A, chaired by President of the Resolution Foundation David Willetts.