Adam Posen isn’t ruling out the Bank of England pushing UK interest rates as high as 7%.

The president of the Peterson Institute for International Economics and a former member of the Bank of England’s Monetary Policy Committee, Posen says the 6.25% rate investors have priced in for the end of 2023 is the level he’s been predicting for the past year. “The fact that the inflation is proving more persistent,” he says, just means “they’ll have to go higher.”

Joining David Merritt and Francine Lacqua on this week’s In the City, Posen says that—both in terms of policy and communication—the Bank of England got it wrong repeatedly throughout 2022 and into 2023. He also gives his take on the UK mortgage market meltdown—which he says doesn’t warrant a bailout. 

Adam Posen isn’t ruling out the Bank of England pushing UK interest rates <a href="bbg://news/stories/RXBUKDT1UM0W" data-web-url="https://www.bloomberg.com/news/articles/2023-07-05/jpmorgan-sees-risks-of-7-interest-rate-and-hard-landing-in-uk" data-cke-saved-href="bbg://news/stories/RXBUKDT1UM0W">as high as 7%</a>. The president of the Peterson Institute for International Economics and a former member of the Bank of England’s Monetary Policy Committee, Posen says the 6.25% rate investors have priced in for the end of 2023 is the level he’s been predicting for the past year. “The fact that the inflation is proving more persistent,” he says, just means “they’ll have to go higher.” Joining David Merritt and Francine Lacqua on this week’s In the City, Posen says that—both in terms of policy and communication—the Bank of England got it wrong repeatedly throughout 2022 and into 2023. He also gives his take on the UK mortgage market meltdown—which he says doesn’t warrant a bailout.

Get ahead of the trends and conversations that are shaping the City of London. Join Bloomberg's Francine Lacqua, Allegra Stratton and Dave Merritt every Thursday as they uncover the best stories and speak to the people in the know. 

Get ahead of the trends and conversations that are shaping the City of London. Join Bloomberg's Francine Lacqua, Allegra Stratton and Dave Merritt every Thursday as they uncover the best stories and speak to the people in the know.

Every week, Francine Lacqua and David Merritt go behind the scenes in the City of London, uncovering stories and speaking to the people that matter.

In the City

Get ahead of the trends and conversations that are shaping the City of London. Join Bloomberg's Francine Lacqua, Allegra Stratton and David Merritt every Thursday as they uncover the best stories and speak to the people in the know. 

Get ahead of the trends and conversations that are shaping the City of London. Join Bloomberg's Francine Lacqua, Allegra Stratton and David Merritt every Thursday as they uncover the best stories and speak to the people in the know.

In The City

Peterson’s Adam Posen ‘Wouldn’t Rule Out’ 7% UK Interest Rate

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/468c1f3f-224b-40a8-865b-b03c00f9d251/transcript

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