Rock: Rate hike before Q4 would be ultimate policy error

clock

An imminent interest rate hike would be the ultimate policy error by the Monetary Policy Committee, which should not raise rates before Q4 if inflation is still high, says Caspar Rock at Architas.

The firm's deputy CIO says CPI would be at around 2.4%, rather than the 4.4% seen in February, if taxes such as VAT and fuel duty had not been raised. "Will putting up interest rates make the government cut taxes? I do not think so. "The whole point of raising interest rates is to try and control growth and inflation. Another way of doing it is to raise taxes, so the core rate of inflation is low and we will be trending down in the second half of the year, back towards the Bank of England's target range of 2%-3%." Rock says he does not think it is right to boost interest rates now,...

To continue reading this article...

Join Investment Week for free

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now

 

Already an Investment Week
member?

Login

More on Investment

Event Voice: Your questions answered by FSSA Investment Managers at the Emerging Markets Conference

Event Voice: Your questions answered by FSSA Investment Managers at the Emerging Markets Conference

Angus Sandison, Investment Analyst, FSSA Investment Managers
clock 24 April 2025 • 3 min read
US M&A spending jumps 50% in March as deal volume declines

US M&A spending jumps 50% in March as deal volume declines

Near 6% drop in number of deals happening

Eve Maddock-Jones
clock 23 April 2025 • 1 min read
Stories of the week: The FCA, Bank of America and Neil Woodford

Stories of the week: The FCA, Bank of America and Neil Woodford

Recession expectations, AI chips and Hargreaves Lansdown: The biggest stories from the world of investment and asset management this week

clock 17 April 2025 • 1 min read
Trustpilot