BoE’s Forbes: Risk of Pickup in Wage Growth

Bank of England policy maker Kristin Forbes said the pound’s downward pressure on U.K. inflation may start fading and there’s a risk of a pickup in wage growth.

Forbes, a former White House adviser, made the comments in her first speech since joining the BOE in July. While she has voted to keep the key interest rate at a record-low 0.5 percent, her remarks chime with the view of the minority on the nine-member Monetary Policy Committee, who are pushing to tighten policy to ensure inflation remains under control.

With the U.K. poised for the fastest growth in the Group of Seven this year, the debate on when to lift interest rates is intensifying. The pound’s 7 percent appreciation in the past year has helped keep consumer-price growth below the BOE’s 2 percent target, adding weight to the case for maintaining emergency stimulus for now.

Bloomberg