Interest rates to rise “pretty soon”

Interest rates to rise “pretty soon”


Todays other news
Residential, buy-to-let and large loan products are affected...
The shocking statistics come in an Office for Budget responsibility...
The HomeOwners Alliance is a powerful voice in the property...
residential mortgage products to eligible foreign national applicants up to...


The Bank of England has dropped another hint that interest rates are set to rise with departing policy maker David Miles saying it will happen “pretty soon” as UK economic growth picks up.

Miles is leaving the Bank’s monetary policy committee after six years but told BBC Newsnight that the time to rise hike rates was drawing closer.

“I think it’s pretty soon, and I don’t think it’s anything to worry about. It’s a sign the economy is returning to a more normal position.

“It’s taken a long time to get there, and we’re not fully there yet.”

His comments followed Wednesday’s surprise jump in core inflation that analysts said could bring forward the first rate increase.

Miles said UK corporate and consumer confidence was strong, and the financial system is operating “near-normal” now.

The key issue was judging at which diminishing slack in the economy and rising cost pressures rise warrant raising rates, he said.

MPC members Martin Weale and Kristin Forbes have both suggested that a rate rise is not far away.

Yet some analysts say the US Federal Reserve is now likely to retreat from its expected September rate hike.

US inflation fell in July, with both the headline and core consumer prices index increasing 0.1% month-on-month, short of consensus forecasts for a 0.2% rise.

Paul Ashworth, chief US economist at Capital Economics, said the figures will give the Fed pause for thought at its next meeting in mid-September.

“On balance, we still think the Fed will go ahead and raise rates in response to the further improvement in labour market conditions.

“But the decision is finely balanced. With price inflation and wage growth still muted, a case can also be made for waiting.”

A delayed interest-rate hike in the US could also convince the Bank of England to take it slowly.

Share this article ...

Join the conversation: Login and have your say

Want to comment on this story? Our focus is on providing a platform for you to share your insights and views and we welcome contributions. All comments are screened using specialist software and may be reviewed by our editorial team before publication. Introducer Today reserves the right to edit, withhold or delete comments that violate our guidelines, including those that harass, degrade, or intimidate others. Users who post such content may be banned from commenting.
By commenting, you agree to our Commenting Terms of Use.
Recommended for you
Related Articles
Mark Harris is chief executive of mortgage broker SPF Private...
He’s worked for the BoE for 27 years...
One in 10 have no cash savings, another 21% have...
The latest fall in inflation to 2.6% suggests that a...
It's one of the first deals of its kind since...
This hybrid product is designed for borrowers aged 50 and...
This is the second lender in a week to offer...
Recommended for you
Latest Features
Residential, buy-to-let and large loan products are affected...
The shocking statistics come in an Office for Budget responsibility...
Sponsored Content
Historically second charge mortgages or secured loans as they are...
Lenders must say what they mean and mean what they...
Fraudsters attacking the conveyancing sector, successfully stealing large sums of...

Send to a friend

In order to send this article to a friend you must first login. Click on the button below to login or sign up.

No one likes pop-ups ...
But while you're here