Carney says BoE rates likely to rise, contrasts with Haldane

[March 27, 2015]  FRANKFURT (Reuters) - The Bank of England expects its next move in interest rates to be an increase not a cut despite record low inflation, Bank of England Governor Mark Carney said on Friday, underscoring his difference of view with the Bank's chief economist.

"We're still in a position where our message is... that the next move in interest rates is going to be up," Carney said during a panel discussion at a Bundesbank conference in Frankfurt.

BoE chief economist Andy Haldane surprised investors last week when he said a recent sharp slowdown in inflation meant the bank was as likely as not to cut rates - a view that had been previously rejected by Carney.

Several other top policymakers at the BoE have left Haldane looking isolated in recent days.

On Friday, one of the Bank's deputy governors, Ben Broadbent, also played down the sharp fall in inflation which touched zero in February. He said Britain was unlikely to suffer from a long bout of deflation.

(Reporting by Paul Carrel; additional reporting by David Milliken in LONDON)

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