LONDON (MNI) – Interest rates in the U.K. should rise soon, although
at a gradual pace, a leading Bank of England policymaker said in an
interview published late last week.
Speaking to the Grantham Journal, Andrew Sentance said: “We should
be thinking to increase interest rates quite soon but in a way that is
gradual so it doesn’t disturb business and consumer confidence.”
Sentance, the most hawkish member of the Monetary Policy Committee,
has voted for a rate hike at the last four rate setting meetings.
Echoing his recent comment, Sentance added: “The economy is now on a
recovery track and inflation is above target and if we don’t start
adjusting monetary policy we may have to do it more dramatically down
the line and that might be a big shock to confidence.”
Having spoken to local businesses on a regional visit to the
Grantham area, Sentance said local companies were positive about the
economic outlook and had seen a benefit from sterling’s weakness.
“The most positive thing is the manufacturing firms have been quite
positive about the growth we’ve been seeing and the turn around they’ve
been seeing in the last year. They’re reasonably positive about economic
prospects. They’re benefitting from a reasonable exchange rate and
they’re companies that have good prospects”, he said.
–London newsroom: 00 44 20 7862 7499; e-ml: ukeditorial@marketnews.com
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