Bank of England Rate Cuts Need to Have Impact, Says Tim Besley

By Thomas Biesheuvel

Dec. 22 (Bloomberg) -- The Bank of England’s interest rate cuts need to have an impact to make sure inflation is not below the 2 percent target next year, Tim Besley said in the Daily Mail.

The bank’s Monetary Policy Committee has to concern itself with inflation falling below 2 percent just as much as rising above and the actions taken so far should make deflation less likely, Besley, a member of the MPC, said in the newspaper.

Mortgage and saving interest rates are less responsive to the official rate than in the past because of the difficulties in the banking system, Besley said.

Returning the banking system to normal remains a high priority and policy measures, beyond those of the MPC, continue to target this, Besley said.

To contact the reporter on this story: Thomas Biesheuvel in London tbiesheuvel@bloomberg.net