Bank of England Policymaker Cools Interest Rate Hike Expectations

Bank of England policymaker Alan Taylor has downplayed the need for raising interest rates, saying the case is 'not compelling' unless energy prices stay high for longer and have a bigger impact on the economy.

In a speech at the National Institute of Economic and Social Research (Niesr), Taylor noted that higher energy costs are still concentrated within the energy complex itself rather than spreading widely through the economy.

He emphasized the importance of staying 'alert' to developments in the economy, but argued that the case for an interest rate hike should rest on evidence of second-round effects gaining traction, not just the existence of the energy shock alone.