BOE’s Dhingra Says Rate Cuts Needed as Policy Is Too Restrictive

External MPC member estimates higher neutral rate of 2.5%-3.5%
Dhingra says trade war risks damaging growth, productivity

WATCH: Dhingra says that high interest rates are bearing down on the economy, and that she’s in favor of a “gradual” cutting cycle.Source: Bloomberg

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By Philip Aldrick, Lizzy Burden, and Tom Rees

December 6, 2024 at 7:11 AM EST

Bank of England policymaker Swati Dhingra warned that high interest rates are bearing down too heavily on the economy by curbing consumer spending and business investment.

“We have a very restrictive stance at the moment,” the external member of the Monetary Policy Committee said in an interview with Bloomberg TV Friday. “The weak consumption, the weak investment, and possible damage to supply capacity is what I would worry about, and that’s why I think we should be easing policy more.”