Britain’s labour market is “fizzing away nicely” and wages are growing faster than expected, Bank of England policymaker Martin Weale said in an interview with the Financial Times in its Wednesday edition, indicating that he might soon vote for a rate rise.
The FT reported that Weale, a member of the BoE’s Monetary Policy Committee who voted for rate rises last year, believed the central bank should be ready to raise rates as soon as August.
The FT did not directly quote Weale as saying this, but did report him saying that wages were now rising faster than he had expected they would when he had previously voted for a rate rise in the latter part of 2014.
“If you’d asked me last autumn how rapidly I thought wages might pick up, looking at the most recent numbers, the movement seems to have been a bit faster than that,” he said.
“Rather than … fizzling out, the labour market … is fizzing away nicely,” he added.
The BoE has identified wage growth as one key factor that will aid its decision as to when Britain’s economic recovery is robust enough to support higher interest rates.
Most economists do not expect rates to rise until early next year. Ian McCafferty, the only other MPC member who backed a rate rise in late 2014, said last week that data would determine whether rates rose towards the end of this year or as late as June 2016.