Britain's economy is growing at its fastest pace in six years. Fourth quarter numbers out this morning showing expansion of 0.7% in the fourth quarter or nearly 2% for the whole of 2013. Berenberg Bank Chief UK Economist Rob Wood says the Bank of England needs to consider raising rates by early next year.

SHOWS: LONDON, ENGLAND, UK (REUTERS - ACCESS ALL) (JANUARY 28, 2014)

1. BERENBERG BANK CHIEF ROB WOOD, SAYING:

JOURNALIST: 'Britain's economy is growing at its fastest pace in six years. Fourth quarter numbers out this morning showing expansion of 0.7% in the fourth quarter or nearly 2% for the whole of 2013. So where does that leave the Bank of England and its guidance on rates? Joining me now is Berenberg Bank Chief UK Economist Rob Wood. Rob, does this number put Carney in a much more difficult position now? '

WOOD: 'Well I think it does. So we also know from figures released this month that employment in the UK is rising very rapidly and now we've got a decent growth figure. So on the one hand, it looks like the UK economy is growing pretty rapidly and I think rapid growth notwithstanding the fact that UK has had a bad few years, this rapid growth is translating into a tightening labor market which normally you would think would lead to a rate rise, certainly not rates at emergency low levels of 0.05%. So in that sense, I think stronger growth, better labor market - it all ties together and means this forward guidance needs to be dropped by the Bank of England and they need to consider raising rates probably by early next year. '

JOURNALIST: 'Okay. But on the same side, Rob, industrial growth wasn't that impressive and construction, I believe, actually contracted. I mean can we see this growth figure be revised lower or not?'

WOOD: 'Well it will definitely be revised, that's what we certainly know. They are generally revised a lot, these initial figures. I think it's more likely to be revised higher than lower. So this construction figure comes in a quarter which there was very bad weather so that might be one factor. It follows a very, very strong third quarter for construction as well so there may be a little bit of volatility from one quarter to the next. What we also know is services expanded strongly again. Manufacturing expanded strongly again. Construction surveys are red hot. There's all sorts of anecdotal stories about shortages of construction materials and so on. So I think it's likely construction will grow, the economy will grow pretty rapidly through 2014 and we may, if anything, see this figure revised up. '

JOURNALIST: 'Okay. We've got Carney speaking and also beginning of February, we've got the inflation report. What do you expect out of those two events?'

WOOD: 'Well I think Mark Carney is - he spoke in Davos last week and the point he's making is the UK recovery still has a long way to go. There are still headwinds dragging back the UK and I think he'll probably repeat that message. But I don't think the message really stacks up in terms of keeping interest rates at 0.05%. I mean that's all true, the UK does have a long way to go, there are headwinds dragging it back. But the question is, do you need rates at 0.05% to get decent growth in the face of that? And I think the data for 2013 is showing us that growth is accelerating very strongly. For the inflation report, we'll see a review of forward guidance. They will be very close to hitting their 7% threshold and they'll likely come up with an alternative. I think it's unlikely to be something super dovish like lowering their unemployment threshold to 6.5%, but probably trying to repeat this message that Carney is giving that there is still some way before they raise rates.'

JOURNALIST: 'So just to finish up, based on what you're saying, do you think rates will have to rise a lot sooner than the spring 2015 that everyone's looking out for? '

WOOD: 'Well I think ideally, we would raise before spring 2015. There was a survey out just this month reporting record recruitment difficulties, for instance, unemployment is dropping fast. So I mean I'm not talking about raising rates a lot but a 25-basis-point raise in Q4 this year I don't think would knock the recovery completely off track and it's probably necessary. In all likelihood, the bank with this more dovish rhetoric will wait until the first quarter of 2015.'