UK Markets closed
  • FTSE 100

    7,556.23
    -2.26 (-0.03%)
     
  • FTSE 250

    19,363.28
    -46.14 (-0.24%)
     
  • AIM

    853.32
    +2.76 (+0.32%)
     
  • GBP/EUR

    1.1657
    +0.0014 (+0.12%)
     
  • GBP/USD

    1.2289
    +0.0033 (+0.2667%)
     
  • BTC-GBP

    13,858.29
    +25.52 (+0.18%)
     
  • CMC Crypto 200

    404.79
    +3.37 (+0.84%)
     
  • S&P 500

    4,071.70
    -4.87 (-0.12%)
     
  • DOW

    34,429.88
    +34.87 (+0.10%)
     
  • CRUDE OIL

    80.14
    -1.08 (-1.33%)
     
  • GOLD FUTURES

    1,811.90
    -3.30 (-0.18%)
     
  • NIKKEI 225

    27,777.90
    -448.18 (-1.59%)
     
  • HANG SENG

    18,675.35
    -61.09 (-0.33%)
     
  • DAX

    14,529.39
    +39.09 (+0.27%)
     
  • CAC 40

    6,742.25
    -11.72 (-0.17%)
     

BoE's Pill says rates need to rise, but not to 5.25%

Bank of England Monetary Policy Report News Conference, in London

LONDON (Reuters) - The Bank of England needs to raise interest rates further, but not as high as the 5.25% level which financial markets had priced in before the central bank's latest rate decision, BoE Chief Economist Huw Pill said on Friday.

Pill was giving a presentation to businesses about the BoE's decision on Thursday to raise interest rates to 3% from 2.25% - its biggest rate rise since 1989 as it battles the highest inflation in 40 years and a potentially lengthy recession.

Pill's remarks hewed closely to the line set out by Governor Andrew Bailey and in a statement agreed by the majority of the BoE's Monetary Policy Committee.

"We don't take comfort from the fact that the profile of inflation, based on our constant-rate scenario at 3%, is keeping inflation not far off the 2% target at the two-year horizon," he said, citing upside risks to inflation from factors such as a tight labour market.

"There is still more to be done ... (but) market pricing is a bit skewed, if you like, in the direction of higher rates than we think is appropriate," he added.

(Reporting by David Milliken; editing by William James)