- Ian McCafferty, BoE policy maker
The BoE's Monetary Policy Committee voting member Ian McCafferty urged the central bank to raise interest rates now if it intends to keep further rate increases smooth and steady to minimise the disruption to consumers and businesses. McCafferty underlined that the BoE needs to avoid getting "behind the curve" when it comes to making its first interest rate hike since before the financial crisis.
Even though the British economy has been growing strongly for the last two years, the BoE signalled it is in no hurry to hike rates, as eight of the nine rate-setters have continued to vote to maintain rates at record low 0.5%. While markets currently price in an interest rate hike only around the end of 2016, a number of economists expect the central bank to move early next year. BoE Governor Mark Carney has said a decision on a rate hike will become clearer around the turn of the year. McCafferty, the only policy maker who has been voting for a rate increase from August through October this year, argued at the latest MPC meeting that "the likely prospective increase in domestic costs was sufficient to justify an immediate increase in Bank Rate."
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