Incoming Bank of England governor Mark Carney has warned Europe could face a “decade of stagnation” unless it takes bolder policy decisions such as boosting quantitative easing.
The Daily Telegraph reports that in his last speech as Bank of Canada governor, Carney backed Japan’s “bold policy experiment” of boosting its quantitative easing programme.
The newspaper suggests this declaration of support could see Carney extend the UK’s asset purchase programme in a bid to boost growth when he takes over as Bank of England governor next month.
Carney said: “Europe can draw lessons from Japan on the dangers of half measures… Europe remains in recession. Deep challenges persist in its financial system. Without sustained and significant reforms, a decade of stagnation threatens.”
He attributed Canada’s success to “responsible fiscal policy, sound monetary policy, and a resilient financial system”, and added that out of the G7 nations, only “Canada does not need to repair”.
The International Monetary Fund will today publish its annual update on the UK economy, and its position on chancellor George Osborne’s strategy for getting the economy back on track.