You need to enable JavaScript in order to use the AI chatbot tool powered by ChatBot

Low inflation 'may not prevent rate rise'

Andrew Barnes our consultant managing the role

The base rate may yet rise this year, despite minimal inflation, according to one economist.

The UK financial sector has spent much of the last few years dealing with false alarms about possible base rate rises, which are often predicted a few months down the line without actually materialising.

Last year was a case in point, chiefly because the minutes of Bank of England Monetary Policy Committee (MPC) meetings hinted that some were wavering on holding at 0.5 per cent.

Convictions that change was on the way were further fuelled by minority support for a rate rise (by Ian McCafferty and Martin Weale) that continued until this month, as well as talk by governor of the Bank Mark Carney that rates could reach around 2.5 per cent by 2018.

Such possibilities have been considered before. In 2011, for instance, as many as three members supported a rate hike. However, just as in the MPC meeting this month, the committee has eventually reverted back to its unanimity for a rate hold.

Despite this, 2015 may yet see a rate rise, according to Schroeders economist Azad Zangana. Reflecting on the data that showed economic growth slowing to 0.5 per cent, he said the overall economic performance actually remains strong, once the impact of reduced oil revenues is taken into account.

He added that it is possible inflation may turn negative, which might be seen as a good reason to stick with the 0.5 per cent base rate. However, Mr Zangana noted: "Governor Mark Carney has warned that the Bank has the ability to look through short-term moves in inflation, and so may yet consider raising interest rates by the end of the year."

This assertion may be backed by recent history, albeit under Mr Carney's predecessor, Sir Mervyn King. After all, the MPC has previously 'looked through' high inflation to keep the rate at 0.5 per cent with wider economic imperatives in mind.

So for the financial sector, a response to changes in interest rates may yet be required this year, even if the low oil price keeps inflation down or even brings deflation.

11/04/16
jobs

Related jobs

Group Reporting Manager

Salary:

£65,000 - £73,000 per annum + Excellent Benefits Package

Location:

Manchester, Greater Manchester

Industry

Consumer & Retail

Qualification

Fully qualified

Market

Commerce & Industry

Salary

£70,000 - £80,000

Job Discipline

Qualified Finance

Contract Type:

Permanent

Description

Exciting Group Reporting Finance Manager for a leading retail organisation based in Manchester offering hybrid working paying circa £70,000.

Reference

BBBH184314

Expiry Date

01/01/01

Nathan  Jones

Author

Nathan Jones
Find out more
Interim Financial Controller

Salary:

£400 - £475 per day

Location:

London

Industry

Private Equity

Qualification

Fully qualified

Market

Commerce & Industry

Salary

£350 - £450

Job Discipline

Qualified Finance

Contract Type:

Contract

Description

PE-backed SME seeks Interim Financial Controller for financial ops & strategic planning. Strong data analysis & PE experience required.

Reference

BBBH183888

Expiry Date

01/01/01

Jaden Alie

Author

Jaden Alie
Jaden Alie

Author

Jaden Alie
Find out more
Transactional Finance Manager

Salary:

Negotiable

Location:

Horsham, West Sussex

Industry

Technology

Qualification

None specified

Market

Commerce & Industry

Salary

£60,000 - £70,000

Job Discipline

Part Qualified & Transactional Finance

Contract Type:

Permanent

Description

Our high growth client in the tech/SAAS industry are looking for a new Transactional Finance Manager to join their finance team.

Reference

129384

Expiry Date

01/01/01

Harry Latham

Author

Harry Latham
Find out more
Tax Accountant

Salary:

Up to £45,000 per annum

Location:

Leeds, West Yorkshire

Industry

Business Services

Qualification

None specified

Market

Financial Services

Salary

£40,000 - £50,000

Job Discipline

Tax

Contract Type:

Permanent

Description

.

Reference

BBBH184306

Expiry Date

01/01/01

Aleksandra  Taranovskaja Find out more
Credit Controller

Salary:

£30,000 - £32,000 per annum

Location:

Leeds, West Yorkshire

Industry

Business Services

Qualification

None specified

Market

Commerce & Industry

Salary

£30,000 - £35,000

Job Discipline

Part Qualified & Transactional Finance

Contract Type:

Permanent

Description

Credit Controller in Leeds

Reference

BBBH184266

Expiry Date

01/01/01

Cameron  Walsh

Author

Cameron Walsh
Find out more
Financial Services Programme Director

Salary:

€100,000 - €110,000 per annum

Location:

Dublin City Centre, Dublin

Industry

Business Services

Qualification

None specified

Market

Financial Services

Salary

£80,000 - £100,000

Job Discipline

Project & Programme Management

Contract Type:

Permanent

Description

Programme Director - Financial Services - Dublin

Reference

BBBH183758

Expiry Date

01/01/01

Cillian Mcevoy Find out more
Financial Services Strategy Consulting Manager

Salary:

€70,000 - €85,000 per annum

Location:

Dublin City Centre, Dublin

Industry

Business Services

Qualification

None specified

Market

Commerce & Industry

Salary

£70,000 - £80,000

Job Discipline

Change Management

Contract Type:

Permanent

Description

Financial Services Strategy Consulting Manager- Dublin

Reference

BBBH182070

Expiry Date

01/01/01

Cillian Mcevoy Find out more
View all jobs