Skip to content

Bank of England: Wales facing cost of living 'squeeze'

BBC Andy Haldane, the Bank of England's chief economistBBC
Mr Haldane met people in Barry, Porth and Cardiff to hear what financial difficulties they face

People in Wales are facing a "squeeze" because pay is flat but the price of goods has gone up, according to the Bank of England's chief economist.

Andy Haldane said interest rates could "edge up" if the cost of living continues to rise.

He spoke to residents in Barry, Porth and Ely in Cardiff in the first visit of its kind in the UK.

Mr Haldane told BBC Wales certain issues like economic inactivity needed to be tackled in Wales.

He sits on the Bank of England's Monetary Policy Committee, which is responsible for setting the interest rate in the UK.

In 2014, he was voted one of the most influential people in the world by Time magazine.

Andy Haldane said the UK's financial issues are particularly "resonant" in Wales

He said: "We need to look seriously at the possibility of raising interest rates to keep the lid on those cost of living increases.

"For now we are happy with where the rates are, we need to be vigilant for what happens next".

The visit was organised by Citizens Cymru Wales.

'Extremely difficult'

Issues raised included affordable housing, the living wage, mortgages, poverty and transport.

Nikki Cole, one of the residents at the meeting in Barry, said her family are finding it difficult.

"I had my son and daughter-in-law in tears last night because they don't know how they are going to manage," she said.

"I had to use my redundancy money to help them, not realising my husband was going to die a year later. For my family and friends it's extremely difficult."

Mr Haldane said transport, skills and economic inactivity were all issues that needed to be addressed in Wales.

"Do young people have the right sets of skills to find a way into the world of work? Levels of inactivity, people not involved in the jobs market, tend to be a bit higher in Wales," he explained.

"Transport infrastructure is a big question - the difficulty of getting around between areas is something of an obstacle to businesses and people in the world of work."

The tour is part of the Bank of England being more proactive in finding out what financial issues people are facing across the UK.