n interest rate rise is in the post but will it make any difference?
Today’s forecast-busting inflation figure means a rate rise next month looks almost certain. With inflation jumping at its fastest rate in three decades, the Bank of England has to be seen to be doing something.
The problem is an interest rate hike might not do much.
Still, Bailey & co have to do something. Inflation is rising so rapidly it risks becoming embedded. Even if a rate rise is marginal, helping around the edges is better than nothing. Then there’s the issue of the Bank’s credibility.
Hiking rates might not put a stop to soaring inflation but it could at least slow it — and go some way to repairing relations with the City. Time to act.