Carney hints at August rate rise as UK economy rebounds

In a speech given at the Northern Powerhouse Business Summit, Carney noted that employment is at a record high, real wages are rising, and "domestic inflationary pressures are gradually building to rates consistent with the inflation target".

He added that with excess supply in the economy "virtually used up" and the Brexit date looming, the economy could travel along two broad paths: one relatively bumpy, the other relatively smooth.

However Carney's focus was on the 'smooth' economic path, which he says is currently consistent with the MPC’s current central projections.

Carney added that if the economy does develop in line with these projections, "an ongoing tightening of monetary policy over the next few years would be appropriate to return inflation sustainably to its target".

He says this has been strengthened by a number of household spending and sentiment indicators which "have bounced back strongly from what increasingly appears to have been erratic weakness in Q1".

The Bank of England's Monetary Policy Committee voted by a majority of 6-3 to maintain Bank Rate at 0.5% at its latest meeting last month.

Andy Haldane joined Michael Saunders and the hawkish outgoing-MPC member Ian McCafferty in calling for an immediate rate rise, however the majority held off after the bad weather caused a slump in GDP growth.