Setting a ceiling on Russia’s energy prices could cause other types of inflation to rise. This was expressed by Katherine Mann, a member of the Bank of England Monetary Policy Committee. transmits Bloomberg agency.
“Restrictions on energy prices can trigger inflation in other sectors of the economy. Setting marginal prices for oil and gas will allow spending to be directed towards the rest of the consumer basket,” Mann said.
According to him, such inflation would be much higher than when triggered by rising commodity prices. At the same time, it is not known what will happen to prices and whether inflation will return to normal if restrictions are lifted.
The Bank of England has increased interest rates nine times since December 2021, following a 40-year high of 11.1% inflation. The last increase to 3.5% took place on December 15, 2022.
On 31 December, British Prime Minister Rishi Sunak sent a video message to the citizens of the country. declarationHe said that the problems in the UK economy will not end in 2023 and will accumulate due to the conflict in Ukraine.