The deputy governor of the Bank of England (BoE) has said he voted in favour of a rate rise earlier this month because he was "not convinced" current rates were sufficient for long-term sustainability among certain variables.

In a speech at the University of Surrey, John Gieve said not acting on instability was a bigger issue than bringing about a slowdown.

Mr Gieve said he voted for the rate rise earlier this month because he "was not convinced that current rates would be sufficient to bring credit growth and nominal demand back to their long term sustainable path".

He added that "the impact of moving too slowly on the credibility of the regime and thus the future prospects for the economy was of greater concern, given the robust rate of growth, than an unnecessary slowdown in activity".

Hinting at possible future voting behaviour, Mr Gieve said: "In reviewing the position again in future months I will be watching the trends in the growth of credit and money carefully."

The current interest rate is 5.5 per cent and will be reviewed again on July 5th. Consumer price index (CPI) inflation is 0.5 per cent higher than the target rate of two per cent and the interest rate decision is likely to hint at whether CPI has improved or increased.

So far this year the Bank has raised rates 0.5 per cent from five per cent to 5.5 per cent, but it has remained stable for the last two months.

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