BOE’s Dale Signals Gradual Rate Increases, Financial Times Says

Bank of England Chief Economist Spencer Dale signaled that interest rates in the nation may rise gradually over the next two years, the Financial Times reported yesterday, citing an interview.

When the U.K. reported inflation data this month, markets were betting on an increase in the benchmark rate to 0.75 percent from 0.5 percent by December, followed by 1 percentage point of rises a year over the next two years, the newspaper cited Dale as saying. At the time the report was released, that broad path “didn’t look wholly improbably,” Dale said, according to a report posted on the FT web site yesterday.

“I’m not at all confident that the recovery has taken hold and will definitely power away,” Dale said, according to the report. “However, I’m even more worried about what’s going on in terms of inflation.”