The time for BOE rate increase is moving closer – BOE Governor Carney

FXStreet (Mumbai) – Bank of England (BOE) Governor Mark Carney said during the hearing before the Treasury select committee that a hike in the central bank’s borrowing costs has moved close, while stating that monetary policy has become more accommodative.

He further added, “Over next 3 years I see no scenario where rates would move towards historic levels.”
Carney further said that rise in wage growth key to consumption increase, adding that rise in minimum wage announced at July budget should have some positive effect on productivity. Finally concluding that BOE MPC to do full analysis on national living wage.

His view was supported by another member of the Monetary Policy Committee (MPC), Ian McCafferty, who said such a move might help productivity.

McCafferty notes, “Bank rate normalization may help productivity.”

Policymakers also noted that once the rate-hike cycle begins, the pace of increases will be gradual.

With regard to the inflation development, MPC member David Miles, said that inflation expectations are still pretty well anchored.

Bank of England (BOE) Governor Mark Carney said during the hearing before the Treasury select committee that a hike in the central bank’s borrowing costs has moved close, while stating that monetary policy has become more accommodative.

(Market News Provided by FXstreet)