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Comment on Bank of England Monetary Policy Committee

[ 20-08-2014 ]

Commenting on the MPC minutes published today by the Bank of England, Garry Clark, Head of Policy & Research, Scottish Chambers of Commerce said:

"We remain of the view that it is still too soon for the Bank of England to begin raising interest rates.  Since the Monetary Policy Committee's last vote, inflation has fallen back to 1.6% and, according to some measures, real earnings have fallen.

 

"The primary purpose of monetary policy is to control inflation and, with inflation well within the Government target of 2%, current interest rates are achieving this goal. Whilst our economy is growing, there are few signs of overheating outside of the London property market. We believe that the recovery needs more time to bed in before the Bank takes the initial steps to begin returning interest rates to more normalised levels. The risks of acting too soon outweigh the risks of waiting a little while longer."

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