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MNI INTERVIEW2: BOE Could Need 100BPS More Of Hikes-Ex-Staffer

(MNI) WASHINGTON

Wage growth still far from levels consistent with price stability, says ex-BOE economist Aikman.

The Bank of England could need to boost interest rates another full percentage point with inflation too high and wage growth far above levels consistent with price stability, former BOE economist David Aikman told MNI.

“Another 100 basis points or so doesn’t feel unlikely to me for the UK,” said Aikman, who spent 17 years at the UK central bank. “I find it hard to see how wage growth will moderate to a level consistent with the inflation target without creating a bit more slack in the economy.” (See MNI INTERVIEW: BOE Likely To Revise Up View Of Wage Growth)

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The Bank of England could need to boost interest rates another full percentage point with inflation too high and wage growth far above levels consistent with price stability, former BOE economist David Aikman told MNI.

“Another 100 basis points or so doesn’t feel unlikely to me for the UK,” said Aikman, who spent 17 years at the UK central bank. “I find it hard to see how wage growth will moderate to a level consistent with the inflation target without creating a bit more slack in the economy.” (See MNI INTERVIEW: BOE Likely To Revise Up View Of Wage Growth)

Keep reading...Show less