Deputy Gov of the Bank of England criticises savers

In what could turn out to be a significant public relations disaster for the Bank of England, Charles Bean, the deputy governor, today suggested that savers in the UK should stop moaning and start spending. He believes that savers in the UK should not expect to live off their interest and openly admitted that low interest rates are part of a larger strategy to encourage spending from those who are seeing minimal interest on their savings.

This will not go down well with savers in the UK who have been decimated over the last two years as UK base rates have fallen to 0.5%. Many current accounts and savings accounts are offering very little, if any, in the way of interest and those who are have saved years for their retirement are now being forced to dip into their savings pot. The cat is certainly out of the back with confirmation of the strategy to encourage savers to spend their money by keeping UK base rates at 0.5% for so long. However, this is not the only reason why UK base rates have remained so low, as the UK government and the Bank of England continue to supply cheap credit to the money markets.