LONDON (Reuters) - Bank of England official Ian McCafferty stuck to his view that interest rates should rise now in a newspaper interview published on Tuesday, saying that the economy has not slowed by as much as predicted.
“I feel on the balance of monetary policy that there is a need for change,” McCafferty told the Daily Post newspaper during a visit to Wales.
“I think this would be justified and would be the prudent thing to do at this stage.”
McCafferty was one of three members of the eight-strong Monetary Policy Committee who voted last month to raise interest rates from their record low 0.25 percent.
His comments repeated views of the dissenters outlined in the minutes of the BoE’s last monetary policy meeting. There was no reaction in financial markets.
Official data last week showed the economy expanded just 0.2 percent in the first three months of the year, although economists expect growth recovered a little in the second quarter. [ECILT/GB]
Another MPC member, Gertjan Vlieghe, said on Monday he favoured keeping borrowing costs at their historic low on the grounds that a premature rate hike would be more costly than one that turns out to be a slightly late.
Reporting by Andy Bruce; Editing by Alistair Smout