Bank of England Governor Andrew Bailey said there were clear risks that inflation could again overshoot the central bank's forecasts but markets should not get carried away about the likely scale of interest rate rises
The BoE forecasts inflation will peak at a 30-year high of around 7.25% in April when a 54% rise in regulated household energy bills takes effect.Register now for FREE unlimited access to Reuters.comBailey said there were clear upside risks to the BoE's central inflation forecast if the historic surge in energy prices led to higher wage deals and businesses passing on the costs to consumers.
A combination of higher wages and higher inflation would favour workers with greater bargaining power who tended to be better off, Bailey said. Angela Eagle from the opposition Labour Party asked him to state how much he earned. Bailey he said he could not remember precisely before confirming it was 575,538 pounds a year including pension contributions.Governor of the Bank of England Andrew Bailey speaks during a news conference at Bank of England in London, Britain February 3, 2022. Dan Kitwood/Pool via REUTERS
Deputy Governor Ben Broadbent said the surge in energy prices was likely to be twice as big in 2022 as in any year in the 1970s, when high inflation plagued many economies.
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