UK interest rates 8216 to increase in 2015 8242

The base rate of interest in the UK is not likely to be increased or decreased during 2014, but a change could be made by the Bank of England in 2015.

This is the view of Martin Weale, a member of the Bank's rate-setting Monetary Policy Committee, who suggested that an increase in interest rates could occur in spring next year.

Speaking in a Sky News interview, Mr Weale explained that this would be the "most likely path" for the committee and the Bank to go down in the next 12 months.

Interest rates have been at 0.5 per cent – a record low for the UK – for almost five years and despite regular speculation that a rise is on the way, the Bank has held firm so far.

Governor of the Bank of England Mark Carney, who replaced Sir Mervyn King in the role last year, previously announced that the committee would not even consider a rise in the base rate until UK unemployment fell below the seven per cent mark.

However, he later clarified his comments and explained this would not be a trigger point for the Bank, which will only use unemployment as one of the measures it looks at when deciding how to set rates in the coming months.

Changes coming?

Pressure has been growing on the Bank to announce changes to the UK's base rate in recent months, especially as data released by the Office for National Statistics earlier in the month revealed that inflation has fallen to below the two per cent target mark set by the government.

"I think it is very helpful that we try and explain the most likely path for interest rates is that the first rise will come perhaps in the spring of next year, and then the path is likely to be relatively gradual," Mr Weale told Sky News.

Howard Archer, chief UK economist at IHS Global Insight, told BBC News: "You don't get much more specific forward guidance than what Martin Weale said. It really does tie in with what Mark Carney implied when presenting the inflation report and in the inflation forecasts contained in the report."

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