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Bank of England economist: rate hike will prevent sharp rise
Economy
The Bank of England's chief economist said raising interest rates now would reduce the likelihood the central bank would have to resort to tougher measures to curb inflation.
"An increase in the base rate... will not necessarily be the start of a protracted and aggressive series of hikes," Pill said in a speech prepared for delivery to the Edinburgh Chamber of Commerce on Thursday.
"If implemented effectively and communicated well, a timely increase in the base rate could help prevent some potentially dangerous nominal catch-up dynamics that threaten to make temporary deviations from the inflation target more persistent," he added.
Pill and two other members of the Monetary Policy Committee supported raising interest rates in July. A majority of committee members voted against it, preferring to wait for clearer signals about how the war in Iran will affect long-term inflation pressures.