Bank of England’s inflation response ‘risks higher interest rates for longer’
The Guardian reports that the Bank of England raised borrowing costs from 3.75% to 4% amid UK inflation of 3.5%, driven by oil and gas prices that have climbed since the US and Israel launched their war on Iran, with Brent crude trading above $100 a barrel against about $70 before the war. The National Institute of Economic and Social Research says the hesitant response risks higher interest rates for longer, forecasts inflation staying above the 2% target until at least 2030, criticises chancellor John Healey for deferring difficult budget decisions, and director David Aikman urges the Bank to act more aggressively.
