BOE’s Greene Says Falling UK Interest Rates May Spur Spending

Bank of England rate-setter Megan Greene said Britain’s lagging recovery in consumer spending may be boosted as interest rate cuts reduce the impulse for households to hoard savings.

Greene said she favored a “cautious, gradual approach” to easing policy because of uncertainty over how British consumers will react to falling borrowing costs after interest rate hikes lured many into saving more. “A rate-cutting cycle should reduce the incentives for households to delay consumption and save more,” she said in an opinion piece for the Financial Times published on Monday.