Bank of England policymaker Michael Saunders, who last week backed a bigger interest rate rise than most of his colleagues, said he was worried that inflation could prove stronger than the BoE's forecasts which see it passing 10% later this year.
“I put considerable weight on risks that, unless checked by monetary policy, domestic capacity and inflation pressures would probably be greater and more persistent than the central forecast,” he said in a speech at the Resolution Foundation think tank on Monday.
“As a result, my preference has been to move relatively quickly to a more neutral monetary policy stance.” Please download WikiFX for more forex news.
Saunders and two other members of the BoE's nine-strong Monetary Policy Committee voted to raise Bank Rate from 0.75% to 1.25% at their May meeting. But a majority of six members backed a smaller rise to 1.0%.