LONDON (Reuters) – Bank of England policymaker Michael Saunders, who has backed a bigger interest rate rise than most of his colleagues, said Bank Rate could reach 2% or higher during the next year in order to curb inflation expectations after the recent surge in prices.
Saunders said he did not regard financial market forecasts that Bank Rate – currently at 1.25% – would reach or surpass 2% during the next year “as implausible or unlikely”.
“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 in a speech at the Resolution Foundation think tank on Monday.
(Reporting by Andy Bruce and William Schomberg; editing by David Milliken)
