23 Jun 2014
BoE's Haldane: New normal for rates closer perhaps to 2-3%
FXStreet (Bali) - Bank of England’s new chief economist, Andrew Haldane, said in an interview published Saturday in the Yorkshire Post newspaper, that borrowers should accustom themselves to a ‘new normal’ for rates will be closer perhaps to a 2-3% range.
“The new normal won’t be rates where we thought about them in the past, it is going to be closer perhaps to that 2-3% range. I understand the sense of trepidation around that, interest rates prospectively on the rise, but this will only happen when we are really confident that the economy can take it”, Haldane said.
Haldane made further comments referring to rates: “Right now, there aren’t signs of strong inflationary pressures, there aren’t any signs of strong wage pressures, which is why we are in no rush and when the rate rises eventually come they can afford to be gradual.”
“The new normal won’t be rates where we thought about them in the past, it is going to be closer perhaps to that 2-3% range. I understand the sense of trepidation around that, interest rates prospectively on the rise, but this will only happen when we are really confident that the economy can take it”, Haldane said.
Haldane made further comments referring to rates: “Right now, there aren’t signs of strong inflationary pressures, there aren’t any signs of strong wage pressures, which is why we are in no rush and when the rate rises eventually come they can afford to be gradual.”