The Bank of England acknowledges that this country is facing a big inflationary shock and a long recession

According to the report of the International Economic Group of Fars News Agency, quoted by SputnikThe Bank of England on Thursday defended its decision to raise interest rates in the biggest rate hike in 27 years, saying Britain was facing a “very big” inflation shock.

Bank of England Governor Andrew Bailey said the risks of continued high inflation had increased since the bank’s last meeting in June, prompting the bank to take stronger action. He added: We are facing a very big inflationary shock. Our action today was very clear. We must take stronger measures.

Bailey added in an interview with CNBC: “GDP growth has slowed in the UK and the economy is now expected to enter recession later this year.” We do not postpone policy-making until it is too late. The crisis in Ukraine is not something that can be clearly predicted about its future.

The Bank of England on Thursday raised interest rates by 50 basis points and borrowing costs to 1.75% in an effort to curb high inflation. The bank also issued a gloomy forecast for the UK’s economic growth, saying that the country will enter recession from the fourth quarter of this year and that the recession will last for five quarters.

The Bank of England has faced criticism for not acting sooner and more aggressively to tackle hyperinflation, but Bailey insists that many of the inflationary shocks facing the UK economy are exogenous and unexpected.

The rate hike is the Bank of England’s biggest unit increase since 1995, as it tries to push inflation back towards its 2% target, after hitting a 40-year high of 9.4% in June. had reached and the prices of food and energy have skyrocketed and an unprecedented crisis has been created in the cost of living of English households.

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