AXA IM's Iggo: No rate hike in May despite GDP rebound

Interest rates will be held at the historic low of 0.5% in May as the economy remains muted, according to AXA Investment Managers' Chris Iggo.

The firm's CIO said data in recent weeks has not been strong enough to shift the Bank of England towards near-term tightening. Instead it supports MPC members who argue inflation is elevated because of temporary factors, such as high oil prices. Figures released by the ONS today revealed GDP growth came in at 0.5% for Q1, after contracting 0.5% in Q4 last year. Iggo said: "The UK seems to be underperforming on both growth and inflation. This makes monetary policy decisions more difficult to take. For the moment, however, our view is rates will be left on hold in May but the MPC will r...