Bailey Dismisses Secret Rate Hike Plan Amid Inflation Risks

The Bank of England has denied having a 'secret plan' to unconditionally increase interest rates. Governor Andrew Bailey told MPs at Parliament's Treasury Committee that there are still 'upside' risks to inflation, meaning it is more likely to overshoot forecasts than undershoot.

Bailey stated that the main risk factor is energy prices, which are volatile due to the ongoing Middle East conflict. He emphasized that market expectations of a rate hike do not necessarily mean it will happen.

UK interest rates currently stand at 3.75%, and economists have predicted an increase over the next year amid expectations of higher inflation.