BoE should not be too specific in terms of interest rate guidance, says Miles.

David Miles, a member of the Monetary Policy Committee of the Bank of England (BoE) said the bank should not be too specific when it comes to providing guidance on the future path of interest rates.

However, while Miles also said he was “open-minded” about refining the bank’s message he added that the BoE’s current message - that hikes will be gradual and to levels below those that preceded the financial crisis - remained useful, as it offered clear enough indications.

The BoE could follow the example of some central banks and offer more specific guidance about the path of future interest rates, Miles stated, but the current approach is safer.

"Currently it might be just as useful - and probably less misleading and possibly even more accurate - to give forms of guidance which are more qualitative," Miles said during a speech at the London School of Economics.

The Monetary Policy Committee member admitted that, theoretically at least, there were benefits to be drawn from offering more detailed information about a future hike in rates, though he remained adamant that basing predictions on specific scenarios was not a practice the BoE should seek to implement.

Miles cited as example the US Federal Reserve’s “dot charts” – a graphic showcasing where each individual policymaker believes rates might be heading towards – saying that while they illustrate the different opinions among policymakers, they do not provide any information on how certain their views are.

The central banks of New Zealand and Sweden publish similar graphics charting the estimated possible range of interest rates, though each bank utilises its own method.

The BoE, meanwhile, first introduced forward guidance in 2013 and initially established a direct link to unemployment, a policy which was then reviewed in February following a sharp decline in the jobless rate.

In August, the BoE governor, Mark Carney, came under severe criticism from analysts, who accused him of sending confusing and contrasting messages about the outlook for rates.