Bank of England could rise rates sooner than expected

Baku. 26 January. REPORT.AZ/ Interest rates in Britain may need to start rising sooner than many expectations. Report informs citing the Wall Street Journal, Kristin Forbes, a member of the Bank of England's Monetary Policy Committee.said in an interview. 

Healthy growth in the United States and low oil prices could trigger consumption and investments in the UK that would help the cause for hiking interest rates sooner than market expectations by mid-2016, Forbes told.

Tumbling oil prices in the UK have brought the inflation rate to its lowest in more than a decade, which would further bring down interest rates in the near term. However, rates would eventually rise as the economy expanded in the medium term, Forbes told the newspaper.

The Bank of England has the ability and the duty to return usually low British inflation to its 2 percent target within the next two years, she said.

According to her, British inflation fell to 0.5 percent in December and Bank of England officials have warned it may turn negative in the next few months.

Even as the Bank of England's strategy involves raising rates slowly, the economy may respond in unexpected ways, Forbes added.