The Bank of England’s new chief economist, Andrew Haldane, said in an interview published Saturday in the Yorkshire Post newspaper that UK borrowers should accustom themselves to a “new normal” for the Bank of England’s benchmark interest rate of between 2% and 3%

  • “The new normal won’t be rates where we thought about them in the past”
  • “It is going to be closer perhaps to that 2-3% range”
  • “I understand the sense of trepidation around that, interest rates prospectively on the rise, but this will only happen when we are really confident that the economy can take it”
  • “Right now, there aren’t signs of strong inflationary pressures, there aren’t any signs of strong wage pressures, which is why we are in no rush and when the rate rises eventually come they can afford to be gradual”

Full article at the Yorkshire Post: Bank of England: rate rises will be gradual and should level out at 2-3 per cent

More at the Wall Street Journal (gated): U.K. Interest Rates Won’t Return to Precrisis Levels, Says BOE’s Chief Economist