The so-called neutral level of interest rates is now below 5% for the first time in well over a decade, indicating that the Bank of England will be able to leave the base rate lower for longer in the future, a report from a key Treasury adviser has shown.
Neutral interest rates, which for most of the past decade had been thought to lie at around 5-5.5%, are now around 4.5-5%, according to a study by David Miles, a leading City economist frequently touted as a future Monetary Policy Committee member.
Pound to Euros is higher today at 1.2667
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