BoE MPC member Swati Dhingra said in an Observer interview that interest rate in the UK should peak below 4.5% to avoid deepening and prolonging a recession.
“You do see a much deeper and a longer recession with rates being much higher. That is what I think we should all be worried about … are we going to end up lengthening and deepening the recession if the tightening continues at the pace it is?” she said.
She added that those expecting more large rate hikes are not considering the fall in investment and employment as projected for the new two years. “These are not trivial numbers. The market has clearly not realized how pessimistic that could be for the UK economy,” she said. “The economic slowdown is here.”
