made by the mpc are much less straightforward than they appeared to be before the financial crisis. the global climate is now more inflationary and it seems unlikely that the margin of spare capacity in the uk economy will prevent current inflationary pressures from becoming embedded, without monetary policy being tightened. we have heard the news today that cpi inflation has risen again – to 4. 4 % – and it could easily rise above 5 % later this year. once businesses and individuals come to expect higher inflation – and there are increasing signs that they are beginning to do so – these expectations will be much harder to dislodge. in this environment, with inflation running very considerably above its target level and set to rise further, failure to take timely monetary policy action risks a more abrupt and destabilising rise in interest rates in the future. that is surely something which the businesses represented here today would not want to see. and that could be a much bigger threat to future economic growth than the gradual increases in interest rates which i have been arguing for since the middle of last year. see sentance ( 2011 ). this is a point repeatedly made by orphanides. see his recent comments in orphanides ( 2011 ), for example. bis central bankers ’ speeches references orphanides, a. ( 2011 ) “ the role of central banks – lessons from the crisis ” panel remarks at the vi international symposium of the banque de france on 4 march 2011. sentance, a. ( 2011 ) “ the uk ’ s inflation problem : selling england by the pound? ” speech at to the iea state of the economy conference on 17 february 2011. bis central bankers ’ speeches

stylish regulation speech given by sam woods, deputy governor for prudential regulation and chief executive officer, prudential regulation authority at the ubs financial institutions conference, lausanne thursday 16 may 2019 all speeches are available online at www. bankofengland. co. uk / publications / pages / speeches / default. aspx i met recently with the head of a large foreign bank, who was in london following a visit to the continent. he had been advised by some of our eu colleagues that with the departure of the uk from the eu, the british public would become alarmed at the size of the financial sector relative to the size of the economy and would therefore demand ever - tougher financial regulation in order to assuage their sense of unease. thus it was put to him that it would be sensible for him to move more of his operations to paris, frankfurt or dublin, where things would be easier. a noisy pro - brexit demonstration taking place in the next door street seemed to support his case. but i told him that i thought it somewhat unlikely that the public would take much interest in the size of the financial sector unless it blew up again, and that ten years on from the financial crisis we have largely implemented the reforms and are moving into more of a business - as - usual phase. i said that we more often heard the opposite concern from eu officials in the context of brexit – that having escaped the “ shackles ” of eu regulation we would embark on a course of weakening financial regulation in a way that makes the financial system less resilient. this, needless to say, would be anathema to the prudential regulation authority and to all of us who have spent the last decade repairing the financial system. so as far as the stringency of financial regulation goes, we at the bank have a clear view of what would make sense for the uk in a post - brexit environment : we should keep it calibrated roughly where it is now and have no desire whatsoever to weaken it. and despite inevitable tensions between regulator and regulated, my impression is that at the most senior levels most of the people running banks and insurance companies in the uk today would agree with that position, and that it also has support in the government and parliament. we need to keep pace with new developments and continually patch any weak parts of the regulatory system, but overall following 10 years of wrenching reform we should let the new architecture do its job.