MPC member calls for interest rates to rise

MPC member calls for interest rates to rise

UK interest rates should be raised, despite risks in the economy, according to a member of the Bank of England's rate-setting committee.

Kristin Forbes, a US academic, was the only member of the Monetary Policy Committee to vote to raise rates this month.

This was the first split between policymakers on rates since last July.

"Monetary policy should not go on hold," Ms Forbes wrote in an opinion piece in the Daily Telegraph.

Ms Forbes, who is due to leave the Bank in June, said raising rates would lessen the risk of above-target inflation, and boost an improved outlook for unemployment and UK output.


Official data on Wednesday showed UK pay growth, adjusted for inflation, halved to just 0.7% - the lowest since October 2014.

But Ms Forbes said that recent weakness in wages growth probably reflects temporary caution about Brexit among employers.

The majority of MPC members saw signs of slowing consumer spending as one reason for caution on interest rates, but Ms Forbes said this should be seen in the context of strong levels of consumption in recent months.

"This softening ... should only be moderate, due to support from resilient consumer confidence, solid house prices, low unemployment, and easy access to cheap credit," she said.

"There are risks consumers could pull back more sharply - but these are still just risks."

Although the UK economy faces a long list of risks including slowing growth, she said these "will continue for years" and should not deter policymakers from making "nimble" decisions.



Add Comment

all comments

  Other news

more
Trump to meet China's Xi in Florida next week

Trump to meet China's Xi in Florida next week..

30-Mar, 04:41

China has confirmed the dates of President Xi Jinping's trip to the US to...

Jeremy McConnell hints he's back with Stephanie Davis as he shares sweet family photo

Jeremy McConnell hints he's back with Stephanie Davis as he shares sweet family photo..

30-Mar, 14:38

And now, the Irish model has heavily hinted he is back with the former...

DEA seized $3.2 billion in cash from people never under investigation  Justice Dept

DEA seized $3.2 billion in cash from people never under investigation Justice Dept..

30-Mar, 13:50

The US Drug Enforcement Administration seized $3.2 billion in cash over a...

Kristina Rihanoff opens up about first Mother's Day with baby Mila and Ben Cohen

Kristina Rihanoff opens up about first Mother's Day with baby Mila and Ben Cohen..

30-Mar, 06:34

Kristina Rihanoff welcomed her daughter Mila last June On Mother's Day...

Audra McDonald opens up about having a baby at 46

Audra McDonald opens up about having a baby at 46..

25-Mar, 10:50

It's been 16 years since Audra McDonald had a baby. Now at age 46, the...

Israeli soldier gets 18 months in Palestinian assailant's death, less than requested

Israeli soldier gets 18 months in Palestinian assailant's death, less than requested..

21-Feb, 10:30

A military court today sentenced Elor Azaria, the Israeli combat medic...

A LIFE Episode 7

A LIFE Episode 7..

03-Mar, 05:02

The following A LIFE Episode 7 English Sub has been released. Full HD...

Tim Tebow says New York Mets spring training is 'a dream come true'

Tim Tebow says New York Mets spring training is 'a dream come true'..

28-Feb, 09:45

Tim Tebow said the start of his spring training debut at the New York...