Huw Pill, chief economist at the Bank of England, is pushing for the interest rate to rise to 4%, while the majority of the Monetary Policy Committee prefers to keep it steady at 3.75%. UK inflation reached 2.8% in March and April 2026, remaining above the central bank’s 2% target. Pill warns against second-round effects: wages rise to compensate for price increases, and businesses pass on those costs, creating a self-reinforcing inflationary cycle. Only two MPC members supported his position by June 2026, opposing Governor Andrew Bailey and the majority who cite labor market weakness to justify holding rates. A move to 4% could temporarily strengthen the pound while weighing on crypto markets.
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