Raise UK interest rates now, says Bank of England policymaker

Spare capacity in UKs fast-recovering economy could be used up this summer and add to inflation pressures, says MPC member Ian McCafferty

The Bank of England should begin raising interest rates now, because spare capacity in Britains fast-recovering economy could be used up by the middle of next year, adding to inflation pressures, a Bank policymaker said in a Sunday newspaper.

Ian McCafferty, one of two Bank rate-setters to have voted for rate hikes since August, reiterated his view that raising borrowing costs now would help the BoE to nudge up rates only gradually.

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