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Bank hints at fourth rate rise

Published On 15 February 2007 at 13:48:22

The Bank of England has intimated that a fourth interest rate rise since August is in the offing.

The Bank's most recent inflation report has suggested that consumer price inflation will continue to stay above the target two per cent figure unless a further rise to interest rates is made.

It follows the public appearance of official figures, which showed that inflation had fallen to 2.7 per cent in January, having nudged the three per cent figure in December.

The Bank has warned that the optimistic figures may not prevent a further base rate hike, stating that it "does not mean that we can ignore concerns about inflation ahead".

"The committee will look through the short-run volatility to the outlook in the medium term, and it remains ready to take whatever action might be necessary," it added.

Gavin Redknap from Standard Chartered, told the BBC: "The overall tone of today's report leaves us confident in our prediction that the next and final hike in the Bank rate will come in May."

The base rate currently stands at 5.25 per cent.

 

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