Bank of England Deputy Governor Sarah Breeden said rate rises are increasingly appropriate as inflation risks grow, warning against waiting too long for high energy prices to feed into wider pressures. Her focus is November’s decision; later moves depend on the economy.
Breeden said she had not been ready to vote for a hike in September, although she was mindful that the balance of risks had shifted. Asked about market pricing of roughly 100 basis points of hikes over the next year, she said she was focused on the first move and could not ignore that pricing.
Deputy Governor Clare Lombardelli said rates would likely have to rise if energy prices stay elevated, unless there is clear evidence of a weaker economy. Governor Andrew Bailey and Deputy Governor Dave Ramsden also raised the prospect of hikes last week; Bailey said there was no firm judgment on what would happen to rates.
