One of the Bank of England's most hawkish rate-setters has played down the prospect of rapid interest rate rises in the battle against soaring inflation in the UK.
Sir Dave Ramsden says the rate will be nowhere near the levels seen before the worldwide financial crisis.
The current interest rate was doubled by the bank's monetary policy committee (MPC) to 0.50% earlier this month.
Sir Dave questioned the path laid out by the futures market, which is predicting a rise to almost 2% within two years.
He said: "Some further modest tightening in monetary policy is likely to be appropriate in the coming months. The word 'modest' is significant here though - I do not envisage bank rate rising to anything like its pre-2007 level of 5% or above, let alone to the kind of levels we used to see before the MPC was formed in 1997."
The committee's next decision on the UK interest rate is due to March 17.
FTSE 100
Meanwhile, growing fears of a Russian invasion of Ukraine continues to give the jitters to global stocks.
The top UK index, the FTSE 100, had a roller coaster time of it yesterday - opening at 7,484 and plunging to 7,387 before recovering to end the day up nine points at 7,494. The index started today down just two points.
One UK company having a bad day on Tuesday was Hargreaves Lansdown.
Workers returning to the office have found themselves with less time to trade shares and invest their savings - resulting in lower profits at the investment platform.
The Telegraph reports that shares in the business plunged 15% to £10.95 on the news - slashing £1.3billion off the company's market capitalisation.
International markets
The three leading indices in the US were all down yesterday.
The Dow Jones fell by 482 points to 33,596, the S&P 500 dipped by 44 points to 4,304 and the Nasdaq slipped by 166 points to 13,381.
But some market watchers are urging investors to keep their cool and focus on longer-term trends.
They maintain that the longer-term impact of the geopolitical strife over Ukraine could be fleeting, and urged investors not to overreact to recent market moves. For example, the S&P 500 is now down almost 10% from January’s record high.
Charles Henry Monchau, chief investment officer at Bank SYZ in Geneva, told Reuters: "We do not see any reason to panic at this stage.
"While most Western media comments sound alarming, we might actually get close to 'peak fear' on this crisis - and there is a high probability that tensions will start to abate from here on."
Companies reporting today
- Finals: Aston Martin Lagonda, Barclays, Metro Bank, Photo-Me, Rio Tinto
- Trading update: Ted Baker