The Bank of England is weighing up whether to raise interest rates by the most since 1995 next week in order to stop the surge in inflation from becoming a long-term problem for Britain's economy.
The BoE has raised rates five times since December with three of the Monetary Policy Committee's nine members voting for a half percentage-point increase at its last two meetings.
The BoE said in June it was ready to act forcefully if needed and Governor Andrew Bailey has said a half percentage-point increase in interest rates is now on the table, as well as the typical quarter-point move.Following is a summary of MPC members' recent comments ahead of the MPC's next scheduled announcement on Aug. 4:July 19: "A 50 basis-point increase will be among the choices on the table when we next meet.
"From the narrow perspective of monetary policy it will result in the near term in the difficult combination of even higher inflation but weaker domestic demand and output growth."July 14: "We will have to respond to whatever happens but we want people to understand that we're not going to let high inflation become sustained and get out of control like it did in the '70s and '80s," Ramsden said.
"The focus of attention will be on indications of more persistent inflationary pressures, which, in my view, places emphasis on potential second-round effects in price- and wage-setting behaviour."May 25: "Looking ahead, we do face a very fine balance ... because aggregate demand will be depressed. Workers now will find themselves in a very difficult situation. They will face very stark choices and their real incomes will suffer," she added.
"But, rather than focus on a precise forecast for Bank Rate over the next year, the key point is that the tightening cycle may - in my view - still have some way to go," he said.Feb. 23: Asked why he voted to raise interest rates by 50 bps in February, Haskel said: "I have to stress it's a very uncertain situation and it's a very, very finely balanced decision."Register now for FREE unlimited access to Reuters.
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