Bank of England: Britons should accept their financial problems

According to the report of the International Economic Group of Fars News Agency, quoted by Reuters, the chief economist of the Bank of England emphasizes the need to firmly maintain the country’s monetary policy in the shadow of inflation.

“Hugh Bell” stressed on Tuesday that the British must accept the reduction of their purchasing power in the face of the historic cost of living crisis, so as not to fuel inflation.

Stating that inflation is caused by shocks outside the UK, such as the corona virus epidemic and the war in Ukraine, he said: The British effort to maintain their standard of living has fueled this inflation, because when companies raise their prices, employees also demand Increase their salary.

According to Bell, somehow in Britain, people have to accept that they are worse off and stop trying to maintain their real purchasing power. This reluctance to accept that we are worse off (…) causes inflation.

The British economist also stressed that monetary policy in the UK should remain tight enough to contain inflation, although very high rates could do significant damage to the economy.

These statements are at the height of the cost of living crisis and with inflation remaining above 10%.

The Bank of England has raised interest rates 11 times in a row since late 2021 to control consumer prices.

The British pound lost 0.74 percent of its value against the dollar on Tuesday, reaching 1.2395.

The Guardian also wrote on Monday that the annual rate of weekly purchases of basic items, from bread and milk and cheese to sugar and tea, is increasing at the fastest rate since 1977.

The latest UK food price data showed that UK grocery inflation eased in April but remained close to a record high, leaving many families struggling with a cost-of-living crisis still unhappy. Because everyone spends their income on buying food and other basic necessities.

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