LONDON (Reuters) - Bank of England Deputy Governor Ben Broadbent said on Wednesday he did not know if the central bank would raise interest rates in 2018, but pointed out that its most recent forecasts showed some increases were likely in coming years.
Asked in a BBC radio interview if this could mean one or two rate increases in 2018, Broadbent replied: “Well, who knows this year? We said over the three-year period of the forecast, I think we had another two or three.”
The BoE raised interest rates for the first time in more than a decade in November and said at the time that a further two hikes were likely to be needed by the end of 2020.
Most investors currently expect the next rate hike towards the end of 2018.
Broadbent, speaking on a BBC personal finance programme, acknowledged that consumer borrowing had risen “quite quickly” in recent years but said that increase followed a steep fall after the financial crisis.
“Yes it’s been growing, but it is still materially lower than it was 10 years ago,” he said.
Asked if BoE the would be prevented from raising rates due to high consumer debt levels, Broadbent said: “No, no, I don’t think that’s the case.”
The BoE’s Monetary Policy Committee is due to announce its next interest rate decision on Feb. 8. Investors expect no change in rates at that meeting but some economists have said another 25 basis-point increase could happen in May, based on recent economic data.
British industry grew solidly in November, data published earlier on Wednesday showed, although it has lagged behind other countries following the 2016 referendum decision to leave the European Union.
Reporting by David Milliken; Writing by Andy Bruce; Editing by William Schomberg