Higher rates ‘here to stay’, says rate-setting committee’s new member
Higher interest rates ‘here to stay’, says the newest member of the Bank of England’s interest rate setting committee
Megan Greene joins the Bank’s Monetary Policy Committee
The newest member of the Bank of England’s interest rate setting committee has warned that higher interest rates could have a lasting effect.
Megan Greene, who joins the bank’s Monetary Policy Committee (MPC) tomorrow, said it would be “a mistake” for central bankers to think that inflation and interest rates “will automatically return to the low levels we saw before the pandemic ‘.
Writing in the Financial Times, Greene added that it was ‘too early’ to say whether rates could return to pre-pandemic levels, noting that investments in green technology and artificial intelligence could ‘spread a wave of innovation generation that increases productivity’.
The comments came as the pound outperformed all other currencies in the G10 group of major advanced economies as traders continued to bet on further rate hikes.
In the second quarter of 2023, the pound rose 3 percent against the dollar. It also registered its biggest appreciation against the Japanese yen in more than a decade.