LONDON (Thomson Financial) - The Bank of England deputy governor John Gieve has stressed that UK economic growth remains in good stead despite the series of interest rate hikes delivered by the central bank, the Derby Evening Telegraph reported.
"The retail sector has tailed off in the last few months because of the recent bad weather, but on the whole, the economy remains quite robust.
"Some have told me that the amount of deals has slowed. But in manufacturing, for example, companies are continuing to expand and employ more people," he was reported as saying.
Gieve said economic growth is on target, making talk of recession premature.
"Overall, we have seen very steady growth," said Sir John, who, in addition to membership of the monetary policy committee, has specific responsibility for the bank's financial stability," he added.
"We're continuing to hit growth forecasts despite rising rates and inflation. But we keep our eye on the situation and react accordingly," Gieve said.
"The important thing is not to over-react with big jumps in interest rates, which could prove disruptive."
Last week, the Bank of England put interest rates up by another quarter point, to 5.75 pct from 5.50 pct. The hike was the fifth in just 12 months, taking the base rate to its highest level since March 2001.
He also noted that it will take time for the rate hikes to have an impact.
sivakumar.sithraputhran@thomson.com
pp/jfr
