Bank of England warns interest rates will rise again if businesses hike prices
The Independent says The head of the Bank of England has warned businesses that raising prices will lead to interest rates being hiked again.
Interest rates were lifted to 4.25 per cent from 4 per cent on Thursday after policymakers on the Bank’s nine-strong Monetary Policy Committee (MPC) voted seven to two for the quarter-point rise following a surprise jump in inflation last month.
Chancellor Jeremy Hunt said he supports the Bank’s decision to hike rates further as “the sooner we grip inflation the better for everyone”.
In an interview with BBC Radio 4’s Today programme, the Bank’s governor said: “I would say to people who are setting prices – please understand if we get inflation embedded, interest rates will have to go up further and higher inflation really benefits nobody.