LONDON (Bloomberg) — The Bank of England may have to raise interest rates further this year to curb inflation pressures from higher wages, the International Monetary Fund said.Increases in borrowing costs since August are “appropriate to help ensure that inflation returns to target,” the Washington-based fund said in a report on the UK economy, released yesterday. “Depending on evolving prospects for wage growth, some further tightening of monetary policy may be required.”

Bank of England policy makers raised interest rates three times in the past six months to curb inflation, which slowed to 2.7 percent in January from a decade-high the previous month. The central bank said on February 14 that higher wages pose an upside risk to its forecast for consumer price gains to slow to the 2 percent target by the end of this year.

“Continuing to communicate the importance of wage restraint will help minimise the need for additional increases in interest rates,” the fund said in its assessment of Europe’s second- biggest economy, known as an article IV consultation.

The fund cut its forecast for UK inflation this year to 2.3 percent from 2.4 percent, predicting the consumer-price index will be at the 2 percent target in 2008.