Investing.com – The pound recovered from early losses after Bank of England (BoE) chief economist Andy Haldane stated Wednesday that he would vote for a rate hike this year.
In the last policy decision by the BoE’s Monetary Policy Committee, three members including Kristin Forbes, Michael Saunders and Ian McCafferty voted in favor of hiking rates by 25 basis points to 0.50%.
In a speech delivered at the National Science and Media Museum in Bradford, Haldane revealed that he was likely to add his name to the list “relatively soon”.
“Having weighed the evidence, I think that the balance of risks associated with tightening 'too early', on the one hand, and 'too late', on the other, has swung materially towards the latter in the past six to nine months,” Haldane explained.
“Certainly, I think such a tightening is likely to be needed well ahead of current market expectations,” he added.
Haldane further admitted that he considered a rate increase at the MPC’s June meeting but held off because he observed “few signs of higher wage growth” and was concerned by “some chance of a sharper than expected slowing in the economy”.
Cable turned higher on the remarks, hitting an intraday high of 1.2700 after having touched session lows of 1.2590. GBP/USD was last up 0.49% at 1.2692.
The pound also rose 0.35% against the yen, while EUR/GBP lost 0.41%.