The Bank of England will “shake up” how it forecasts future inflation following a damning review of its practices, incoming Deputy Governor Clare Lombardelli has said.
Ex-Federal Reserve chair Ben Bernanke had detailed “significant shortcomings”, including the use of outdated technology, in a review of Britain’s central bank last week.
Lombardelli told MPs on Tuesday that she could “absolutely” assure the bank would carry out “a shakeup in response”.
“There’s a huge amount that we can all learn from what’s happened over the last couple of years,” she said, referencing inflationary shocks from the likes of Russia’s invasion of Ukraine.
“It’s been an extraordinary period and extraordinarily painful,” she added.
Bernanke had found “deficiencies” in the bank’s ability to predict how economic shocks would play out.
This included a failure to consult staff in cases, themselves often inexperienced and overworked.
Lombardelli is due to start her role at the bank in July.