Pill Pushes for Prompt Interest Rate Hike Amid Middle East Uncertainty

The Bank of England's chief economist, Huw Pill, has called for a 'prompt' interest rate hike to tackle the threats to inflation sparked by the Middle East energy shock.

Pill reiterated his concerns about the risks of leaving interest rates unchanged while waiting for clearer signs of how the Iran war has affected inflationary dynamics in the UK economy.

In a speech at the Edinburgh Chamber of Commerce, Pill said that he was 'uncomfortable with a 'wait-and-see' framing of the MPC's current decisions over bank rate.'

Pill suggested raising interest rates to 4% would deliver a 'clear and unambiguous signal' of the MPC's willingness and ability to address upside risks stemming from events in the Middle East.