Five interest rate hikes since November are helping to slow consumer spending and the housing market is also cooling, Bank of England Governor Mervyn King said on Wednesday. Speaking to BBC regional radio, King said rising oil prices remained a "particular concern" but that he saw few other pressures on prices. "There are not many inflationary pressures at present," King told BBC Radio Devon. Britain's inflation rate unexpectedly fell further below the BoE's 2 percent target in September to its lowest in six months. The Consumer Price Index dropped to just 1.1 percent from 1.3 percent in August. King said Monetary Policy Committee members "feel that the impact of the rises in interest rates, that have been put in place over the past year, has now started to slow consumer spending and to keep inflation close to the target".
"It's clear that we have seen some slowing in the housing market in the past few months," he told the broadcaster. Asked about the labour market, King said he saw unemployment staying mainly stable and low. In a newspaper interview released ahead of publication late on Tuesday, King said it was too early to call the peak in interest rates and the MPC had no predetermined plans for the cost of borrowing. Bond markets and interest rate futures shot up on Tuesday as Septmeber's weaker than expected inflation data, on the heels of a raft of weaker economic reports, encouraged many investors to call 4.75 percent the peak. But asked by the Western Morning News, a regional English newspaper, if interest rates had topped out, King was quoted as saying: "It is not fair to say that they have peaked because I don't know where interest rates will go, nor does anybody else."////