INTEREST rates are expected to continue rising but a house price crash can be avoided, former Bank of England Governor Lord George said yesterday.
"You really have to anchor on the thought that rising interest rates are a sign of a strengthening economy," he said.
"And I do think the economy is strengthening after a bit of a slowdown - a global slowdown less marked here in the UK. But as the economy picks up speed, as it gets closer to capacity, we need to moderate that rate of growth in order to avoid inflationary pressures building up.
"And I think that is precisely what they have been doing and will continue to do."
Lord George was speaking on the BBC Radio 4 Today programme two days before the next Bank of England interest rates meeting.
On the likelihood of rate rises triggering a house price crash, he said: "The most desirable outcome - I happen to think the most likely outcome - is that the rate of increase in house prices will slow."
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules hereComments are closed on this article