by Frank Shostak
“We are all Keynesians now, so let’s get fiscal.” This is one view according to Ambrose Evans-Pritchard from The Telegraph who believes the time is right for the UK government to loosen its fiscal stance. He suggests that the “Bank of England has done everything possible under the constraints of monetary orthodoxy to cushion the Brexit shock. It is now up to the British government to save the economy, and the sooner the better,” — argues the economics editor of The Telegraph.
According to Ambrose Evans-Pritchard, monetary policy is close to its limits. The Bank of England’s pre-emptive £170 billion stimulus package is brave — and unquestionably the right thing to do in these dramatic circumstances — however, given the present limitations of monetary policy he is of the view that only loose fiscal policy can address the shocks of Brexit.