Leaviss: UK rate rise would be GDP suicide

M&G's Jim Leaviss says an interest rate rise in the UK could be "GDP suicide", although the Bank of England may still succumb to inflationary pressure.

The group's head of retail fixed interest says money markets are already pricing in two 0.25% rate hikes in the UK this year. These rate hikes would kill core inflation but could also bring deflation risks back into play. As such, the Bank should ignore pressure for an imminent rate hike, but Leaviss adds: "The Bank of England does not have much breathing room left, and with persistently high current inflation the Bank's credibility is under attack. We are only one surprisingly robust inflation print away from a UK rate hike." The manager believes an early interest rate hike is more ...