Additional comments from Bank of England’s Gertjan Vlieghe

  • A stronger world economy and labour market tightness is telling us that a further rise in rates is likely to be appropriate if the strength continues
  • Stresses that there is still a huge uncertainty around the rate path
  • Rates could go up faster or more slowly
  • The neutral UK interest rate is also very uncertain
  • Interest rate outlook depends on an uncertain economic outlook over the next few weeks
  • 3 rate hikes still leaves some excess demand

These comment come on top of some from earlier;

  • If there is less credit headwind to UK economy then it may be ready for higher rates
  • There is increased evidence that tight labour markets are beginning to push up wages

The pound went up a touch to 1.3873 as another BOE member talks about rate hikes, even though he’s playing it pretty safe from both sides of the hawk/dove fence.

Ryan Littlestone

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