Interest Rate rise is some way off
Thu 29 Jan 2015
The Bank of England may put up interest rates by no more than 0.5pc a year - and not return to anything like pre-crisis levels for the foreseeable future, according its chief economist.
The central bank is “in no rush to raise” its interest rates, according to Andy Haldane, and the base rate could go no higher than 2.5pc even by the end of the decade.
Mr Haldane admitted that rates would not stay at their historic almost six-year lows “forever”. Yet when they do rise, they may do so at a “very gradual” pace.
“The recovery is taking hold nicely, the last thing we want to do is knock the stuffing out of that.” Markets do not presently expect the Bank to raise its rates until January 2016.
The Bank has held the base rate at 0.5pc since March 2009, following rapid reductions in the aftermath of the financial crisis. In the 10 years before the crisis, interest rates averaged 5pc.
January 2015View older stories >
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