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The UK economy appears to "overstimulated" and the monetary policy has been set too loosely, the monetary policy committee member of the Bank of England Kristin Forbes said Thursday.
This is not an economy that is too weak to support an increase in interest rates, she said at the London Business School. The UK is clearly outperforming or close to equilibrium by every measure except wage growth.
Given that UK inflation is now likely to reach 3 percent, and is forecast to remain above 2 percent for at least three years, this suggests "some urgency" to hike rates, she said.
Forbes, Ian McCafferty and Michael Saunders sought a 25 basis point increase in interest rate at the June session.
Forbes is set to step down from the rate-setting body and will not be present at the next session on August 3.
Regarding the dissenting votes, she observed that not a single dissent since 2013 has come from an internal member.
This is a sharp change from before 2013, when dissents were spread across external members, internal members, and even at times the Governor, Forbes noted.
