Mark Carney has said higher interest rates are “getting closer” but that rates are unlikely to reach pre-crash levels.
In a speech given to the Trades Union Congress, Bank of England governer Mr Carney said: “With many of the conditions for the economy to normalise now met, the point at which interest rates also begin to normalise is getting closer.”
But he added: “For a variety of reasons ranging from the weakness in the euro area to ongoing repair of household balance sheets, we are not expecting interest rates to head back to the levels seen before the great recession.”
Nick Dixon, investment director for Aegon UK, said: “Mark Carney may have told the TUC today that we should get ready for an interest rate rise, but unless a ‘yes’ vote in Scotland causes a serious shock to sterling, it’s hard to see this happening before spring next year.”
