UK must cut interest rate, says BoE policy maker
BoE said that the bank must cut its interest rate soon to ward off the threat of deflation as the British economy enters a recession.
By Agencies |
LONDON: Bank of England policy maker David Blanchflower said the bank must cut its interest rate soon, and by a significant measure, to ward off the threat of deflation as the British economy enters a recession.
Speaking ahead of a scheduled rate decision from the central bank next week, Blanchflower said that interest rates ``do need to come down significantly - and quickly.''
``If rates are not cut aggressively we do face the prospect of a relatively deep and long-lasting recession,'' he added in a speech late Wednesday.
The United States' Federal Reserve cut its interest rate to 1 per cent on Wednesday, saying that downside risks to economic growth remain.
Economists expect the Bank of England to follow is currently running at 5.2 per cent, but the central bank expects it to fall to the government's 2 per cent target early next year.
Speaking ahead of a scheduled rate decision from the central bank next week, Blanchflower said that interest rates ``do need to come down significantly - and quickly.''
``If rates are not cut aggressively we do face the prospect of a relatively deep and long-lasting recession,'' he added in a speech late Wednesday.
The United States' Federal Reserve cut its interest rate to 1 per cent on Wednesday, saying that downside risks to economic growth remain.
Economists expect the Bank of England to follow is currently running at 5.2 per cent, but the central bank expects it to fall to the government's 2 per cent target early next year.
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