MPC’s Weale wary of European headwinds

THERE’S “broad based optimism” but recruitment is getting harder and a weak Europe remains a concern according to Bank of England policymaker Martin Weale.

Mr Weale, who is one of two members of the Bank’s Monetary Policy Committee who has been voting for a 0.25% rise in interest rates, was visiting Yorkshire and told TheBusinessDesk.com: “I’ve been talking to a range of businesses and there was a general impression that business is doing well.

“Some people were saying things are better, but quieter than in the summer, but others are still rolling full speed ahead – it is a good news story.

“There’s the definite impression they are thinking of offering bigger pay rises next time around than they have done in the past, too. I’m hopeful we will see some movement in people’s pay.”

Overall, he said there was “broad based optimism” and “a good picture going forward”.

He said the main issue highlighted among the businesses was the fact that recruitment was getting harder. “As the economy recovers, there are more jobs around and people have to work harder to find people or keep people,” he said.

Although Weale has voted for a rise in interest rates for the past two months, he was unable to say what his most recent vote was.

Speaking about the wider economic picture, Weale, said the biggest headwind facing the economy is the situation on the Continent. However he highlighted that the figures released last week which revealed Euro zone GDP had expanded by 0.2%, double the pace of the previous three months, suggested the situation is “not as gloomy as some people had feared”.

Looking ahead, Weale said: “I am looking forward to a positive business year in 2015. That’s what the MPC is forecasting, but at the same time, you can never be sure.”