UK policymakers to vote on interest rate hike

Bank of England

Policymakers at the Bank of England will vote on whether to lift interest rates on Thursday – and it’s thought that economic and employment growth could give them the confidence to risk a raise.

Interest rates have been locked at 0.5% since 2009, but last year, Bank of England Governor Mark Carney said that an increase would be considered once unemployment dropped below 7%. In the three months before May, the figure fell to 6.5% and many believe that the recovery is now strong enough for the Monetary Policy Committee (MPC) to look at raising rates, although Carney is still cautious and is looking at another economic indicators, such as wages, which remain weak.

We expect the first dissent to come at this meeting,” commented Philip Rush, an economist at Nomura. “However, we assign only a seven per cent probability to a change being announced this month.”

 

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