THE BANK of England may be forced to shove up interest rates even quicker than it was planning following Rishi Sunak's dramatic intervention in energy markets, the City warned today.
That in turn will increase borrowing costs and reduce consumer spending power, increasing the risk of a recession.
The Bank, widely criticised for moving too slowly to curtail inflation, put rates up to 1% earlier this month from 0.75%. It is expected to enact at least four more quarter point rises this year to 2%.
But the Chancellor's £400 handout to cover energy bills, a £15 billion package, could fuel inflation and force the hand of Bank governor Andrew Bailey and the eight other members of the Monetary Policy Committee that sets rates.
This story is from the May 27, 2022 edition of Evening Standard.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the May 27, 2022 edition of Evening Standard.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Sign In
Derby display shows we can handle title pressure, says Arteta
MIKEL ARTETA believes Arsenal's thumping win over Chelsea has filled his players with the belief they can handle the pressure of the title run-in.
Klopp admits he won't miss pressure of derby
IN Liverpool's remarkable 2018-19 campaign, when they finished with 97 points but were still one short of Manchester City, their only missteps in the run-in were against Manchester United and Everton.
'I CAN'T BLAME MY PLAYERS...THE PROBLEM IS BIGGER'
POCH WARNS CHELSEA OVER SUMMER PLANS
Top Gunners throw down gauntlet to title rivals
Five-star performance an ominous warning as Mikel’s men run riot to set up fascinating finale
Glasner effect rubbing off on reborn Mateta
Striker has gone from Palace flop to undroppable since turn of year
Mental health 'taboo' for women at work
ALMOST four out of 10 women have taken time off work as a result of poor mental health over the past year, a new report claims today.
Lloyds predicts property prices will rise in 2024
LLOYDS Bank offered a boost to home owners and those trying to get on the property ladder today when it said prices will rise and the cost of new mortgages will fall this year.
Nottingham Forest are really playing with fire
NOTTINGHAM FOREST'S incendiary post about refereeing decisions in the aftermath of their defeat to Everton on Sunday has been viewed over 43 million times, making it one of football's most successful examples of rage-tweeting.
My problem with Victoria Beckham's new line
THE fashion press must have sore throats from all the praise they are loudly lavishing on Victoria Beckham right now.
Can the dream of smartphone-free kids come true?
Experts believe that phone-based childhoods are seriously harming mental health and parents are fighting back says Emily Phillips