Wait and see

‘We didn’t bottle interest rate hike’ says governor

Bank of England

Rate-setters at the Bank of England are giving the economy more time (pic: Terry Murden)

UPDATE 5 NOVEMBER: The Governor of the Bank of England Andrew Bailey has rejected claims that he talked up an interest rate rise, then failed to follow through.

Mr Bailey denied the Bank of England “bottled it” yesterday, adding: “We expect interest rates to rise and we are very clear”.

The Bank defied expectations of a rise in the interest rate by voting to leave it unchanged at its record low of 0.1% to give the economy more time to recover.

Speaking on radio on Friday morning, he said: “We have to occasionally make quite direct comments on what we think will happen.

“If you ask the question ‘why haven’t you done it now?’ The answer is all to do with the labour market… there were a lot more people using the furlough scheme right up to the end.

“The labour market looks tight in this country at the moment but the missing piece of evidence is just what has happened after the end of the furlough scheme and we don’t have any data to guide us on that.”

He said the Bank will look at unemployment and wage rates once the data is available.

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