LONDON, Oct 19 (Reuters) - British finance minister Philip Hammond said the government did not plan to change the independence of the Bank of England to set monetary policy after the prime minister criticised the side-effects of low interest rates earlier this month.
“There will be no change in monetary policy,” Hammond told lawmakers on Wednesday.
“Monetary policy is independently determined, that will continue to be the case. The Monetary Policy Committee will continue to make decisions on interest rates and recommendations on unconventional monetary policy.”
Prime Minister Theresa May took the unusual step of criticising BoE policy on Oct. 5 when she said near-zero rates and the BoE’s huge bond-buying programme had hurt savers. Aides to May said at the time that the comments were not intended to influence BoE policy. (Reporting by David Milliken, Andy Bruce and Helen Reid; writing by William Schomberg; editing by Stephen Addison)