RECESSION RISK WORTH IT TO TAME INFLATION, SAYS HUNT

CHANCELLOR BACKS BANK'S RATE RISES - HE'D BE 'COMFORTABLE' WITH SLUMP TO SHORE UP ECONOMY

- Nicholas Cecil 

CHANCELLOR Jeremy Hunt today backed the Bank of England hiking interest rates further — even if it tips Britain into recession — if needed to force down high inflation.

Mr Hunt made the startling admission amid fears that the bank’s Monetary Policy Committee may have to raise interest rates from 4.5 per cent to as high as 5.5 per cent to properly grip inflation and stabilise the economy. Such a hike would pile further misery on millions of homeowners who would see their mortgage bills spiral even higher.

But asked by Sky News if he was “comfortable” with the Bank of England doing whatever it takes to bring down inflation, even if that potentially would trigger a recession, he said: “Yes, because in the end, inflation is a source of instability. And if we want to have prosperity, to grow the economy, to reduce the risk of recession, we have to support the Bank of England in the difficult decisions that they take.”