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October 9 (Businesshala) – Inflation running above the Bank of England’s target of 2.0 percent is very worrying and will have to be managed to prevent it from becoming permanently embedded, the bank’s governor, Andrew Bailey, told the Yorkshire Post newspaper in an interview. said in. .
“We will have a very delicate and challenging task on our hands, so we have to kind of stop embedding this thing permanently because that would obviously be very harmful,” Bailey told the newspaper.
“Unfortunately, if you look at our previous forecast, it’s going to be more, I’m afraid.”
Bailey’s comments appeared to favor the more bullish side of the debate around the UK interest rates outlook, despite growing signs of a slowing economy.
The financial markets have already priced in about a 90% chance of a rate hike before the end of the year.
The governor told the newspaper that with the change in consumer behavior due to the pandemic, the economy faced a number of challenges that had to be dealt with.
“We’ve got some really big and unwanted price changes,” he said. (Reporting by Bhargava Acharya in Bengaluru and Andy Bruce in London; Editing by Sandra Maler)