Bank of England Governor Mark Carney has said the 'new normal' for interest rates in the UK will be around 2.5%, a level he predicted they may reach by 2017.
Speaking to BBC Radio 4's Today programme Carney said a return to 'normal' interest rates of 5% is unlikely in the medium term. He said things have changed to the point it is almost impossible to raise rates to their pre-recession level. "The big picture is not whether the bank rate goes from 0.5% to slightly above that lowest ever level," he told the BBC. "That's not the big picture, the big picture is where interest rates go in the medium term, because if I am taking out a mortgage and if I am thinking of investing in a new plant, if I'm thinking about taking on new people. That'...
To continue reading this article...
Join Professional Adviser for free
Signup and gain exclusive members-only insights
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes
