Bank of England's Carney Sees Signs of a Pickup in U.K. Wages

Bank of England Gov. Mark Carney said Tuesday he expects a revival in British household income growth this year after a lengthy squeeze.

In testimony to lawmakers in the House of Lords, the U.K. Parliament's upper chamber, Mr. Carney said he sees signs that wage growth in the U.K. is firming as the labor market strengthens.

He added that the inflationary effect of a steep fall in the pound after 2016's Brexit vote is likely to linger for a few years, though he said the bulk of that effect probably has passed.

"There is a prospect of a return to real income growth later this year," Mr. Carney said.

The BOE raised its benchmark interest rate in November for the first time in a decade and signaled that a couple of further rate rises are likely in the next three years. Central banks including the Federal Reserve in the U.S. and the European Central Bank also are stepping back from the expansionary policies that have fueled growth since the financial crisis.

Mr. Carney's remarks suggest the outlook for interest rates in the U.K. remains broadly unchanged since the central bank last published economic forecasts in November. Officials are due to present updated forecasts Feb. 8.

Write to Jason Douglas at jason.douglas@wsj.com

(END) Dow Jones Newswires

January 30, 2018 12:54 ET (17:54 GMT)