LONDON (Reuters) - Britons should not expect their wages to rise in real terms until the middle of next year despite a strengthening economy, Bank of England Governor Mark Carney said on Wednesday.
Speaking to Channel 4 News after releasing the central bank’s quarterly inflation report, Carney admitted that “not everybody across the country” was benefiting from the recent upturn in growth.
Wages in Britain are rising at less than half the rate of inflation, making the cost of living a key electoral battleground.
“Real wages are not picking up, they haven’t been for a number of years,” Carney said.
“Middle of 2014 through to the end of 2016 ... is (when) you start to see real wage gains,” he added.
Asked if he would be prepared to raise interest rates before Britain’s election, due in May 2015, Carney said: “Well, absolutely ... you have to do the right thing with an eye on the medium term. That’s the horizon for central bank policy.”
Reporting by Christina Fincher, Editing by Belinda Goldsmith