He said if it was just the unemployment figures that had moved he would say it’s still best to hold off dropping the rates, but given the inflation figures as well, now is the time to drop the rates. The Bank will announce its next base rate decision on May 9.
A drop in interest rates would help mortgage borrowers on variable rates struggling to make their repayments while savers may be negatively affected as they would be able to get such high rates.
Mr Hartley added: “With the election round the corner, from the Government’s perspective, I think now would be the perfect time for them to start winning a bit more popularity too if that’s a deciding factor.”
Rob Wood, chief UK economist at Pantheon Macroeconomics, said previously that the unemployment rate and payroll fall will “embolden” Bank of England policymakers to look at interest rate cuts.
He commented: “There is solid evidence the labour market slowed markedly in March….
