BoE Suggests Policymakers Look Through Declining Oil Prices

Bank of England policymakers need to look through the short-term effect of declining oil prices and think about where inflation will be in two to three years' time, one of its rate setters said on Monday.

Monetary Policy Committee (MPC) member Martin Weale said that just as BoE policymakers looked through periods of high inflation caused by high oil prices, they should do the same now that inflation has fallen because of low oil prices.

"The issue for me is a change in (the oil) price level," said Weale, answering questions after a speech to the Mile End Group at Queen Mary college, University of London.

"The MPC when we set interest rates is thinking about where inflation is going to be in two to three years' time. We have to look through the short-term immediate effect."

World oil prices slid another 4 percent to new five-year lows on Monday.

(Reporting by Andy Bruce; Editing by Susan Fenton, Reuters)