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Bank of England exec hints at rate cuts

by LLB Editor
13th Jan 20 7:15 am

Another Bank of England policymaker has floated the idea of cutting the central bank’s main interest rate. Gertjan Vlieghe told the Financial Times he would consider voting for a rate cut, depending on how the economy has performed since the December election.

Mr Vlieghe is the third policy-setter in a week to suggest they may be willing to cut rates when the Monetary Policy Committee (MPC) next meets at the end of this month.

Ian McCafferty, senior adviser at Oxford Economics, told the Today programme that forthcoming economic data, starting with the release later today of GDP estimates for November, would be “quite critical” in determining the case for a rate cut.

“It may be that the economy is picking up a little bit on the basis of slightly improved confidence,” he said, adding that there was now “greater certainty” on Brexit following December’s general election.

However, it was possible that figures for the start of this year would show the economy “running below its potential”, with inflation undershooting the Bank’s 2% target, he said.

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