The Bank of England looks set to begin tightening monetary policy before the U.S. Federal Reserve, but the pace of interest-rate increases should be slower than the Fed's, economists at Goldman Sachs wrote on Friday. The BOE will likely bump up its key rate during the first quarter of 2015 compared with the third quarter of 2015 in the U.S. But U.K. rates are poised to rise around 75 basis points per year versus 100 to 125 basis a year in the U.S. "To the extent that the BOE's model implies a larger impact from interest rate changes on U.K. growth than the Fed's model implies for the U.S, this suggests - all else equal - the need for a more gradual pace of tightening in the U.K. than in the U.S.," Goldman Sachs said.
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