The Bank of England Today, the ruler issued an “apocalyptic” warning about jumping on food and said he felt “helpless” in the fight against inflation, when he told lawmakers that the war in Ukraine could further deepen the cost of living crisis.

The governor Andrew Bailey showed how to further food inflation was the “main concern” for the central bank, especially concerned with wheat and oil.

He told how the finance minister was Kiev told him about Ukraine’s problems with the delivery of these goods as Russia continues to attack the country.

It is estimated that Ukraine supplies 10 percent of the world’s wheat and is also a major producer of sunflower oil.

Rising commodity prices have already had a huge impact on food production worldwide and have become a major factor in price spikes squeezing household budgets.

“The main factor in inflation and its decline is the very large shock of real incomes coming from external forces, and in particular energy prices and world commodity prices,” Mr Bailey told lawmakers.

“It will affect domestic demand and reduce activity, and I fear it will lead to rising unemployment.

Asked by MPs if he felt “helpless” to do anything about inflation, Mr Bailey said yes.

Speaking before the Finance Committee of the House of Commons, Mr. Bailey warned that the problems related to the Ukrainian conflict were “deteriorating.”

In his exchange with deputies, the governor reiterated his previous statement that workers should not demand large wage increases – despite the cost of living crisis – in an attempt to curb inflation.

Mr Bailey, who earns £ 570,000 a year as chief boss on Threadneedle Street, told MPs that high-paying people should “think and think” before asking for a significant pay raise.

The governor also used a meeting of the Treasury Committee to respond to criticism of the Bank’s treatment of sky-high inflation.

Bank of England Governor Andrew Bailey said further food inflation was a “major concern” for the central bank, especially wheat and vegetable oil.

In obscene exchanges, Finance Committee Chairman Mel Stride asked if the bank was

In obscene exchanges, Finance Committee Chairman Mel Stride asked if the bank was “asleep behind the wheel” amid rising inflation

Now the bank has raised interest rates to 1 percent and predicts that CPI inflation will exceed 10 percent this year

Now the bank has raised interest rates to 1 percent and predicts that CPI inflation will exceed 10 percent this year

Mr Bailey told lawmakers that Ukraine’s conflict with Russia was a “big risk” when it came to further rising prices.

He said: “One is the risk of a further shock to energy prices that would result from the shutdown of gas and distillates such as diesel.”

“And what I might think is pretty apocalyptic is food.

“The two things the finance minister said are food in the store, but they can’t get it.

“Although he was optimistic about planting crops as a major supplier of wheat and oil, he said we don’t have the capacity to send it and it’s getting worse.

“This is a major concern for this country and a major concern for developing countries.”

Earlier this year, Mr. Bailey provoked a fierce reaction because of his demands that workers not ask for big pay raises to help stop prices from spiraling out of control.

He did not shy away from these comments, addressing the deputies today, although he insisted that he did not “preach” on this issue.

“I talked about it in an interview,” he said.

“I think people, especially people with higher wages, should think and reflect on asking for high pay raises.

“This is a public issue. But I’m not preaching about it. I was asked if I had raised myself this year and I replied no, I asked the bank not to give it to me because I thought it was right for me personally.

“But everyone has to make their own opinion about it. Not me walking around and telling people what to do.

“In that sense, I know I may have been explained as what I do, but it’s not. I said that maybe people should think about it, especially people in such a situation. “

The governor denied that the bank “slept behind the wheel” due to inflation, when he faced a grill from MPs.

He attacked the criticism “lately”, but acknowledged that the Bank is facing the biggest problem for its structures over the past 25 years.

Threadneedle Street has called for admitting a “mistake” in stopping past action, insisting for months that inflation was “transitional”.

In obscene exchanges, committee chairman Mel Stride asked if “the bank was asleep behind the wheel”.

But Mr Bailey said economists were making “accurate and tough judgments”, insisting they could not “predict” war in Ukraine.

“As you say, there have been a series of supply shocks, and most recently with the aftermath of the war, Russia’s invasion of Ukraine,” he said.

“We can’t predict things like wars – it’s not in anyone’s power.

“I don’t think we could have done anything differently; we could not see a war with Ukraine. “

There were statements of unrest in the Cabinet of Ministers over the activities of the Bank, which has now raised interest rates to 1 percent and predicts that CPI inflation this year will exceed 10 percent.

Some have even offered to reconsider their independent status as Britons have suffered from soaring prices and Rishi Sunak is under tremendous pressure to offer more help.

However, the governor warned that it could be catastrophic, saying independence is “more important than ever” when times are tough.

Mr Bailey dismissed criticism from politicians, saying it was “not the world I particularly react to”.

He said he was “always” worried about the bank’s independence.

“This is the biggest monetary policy test we have conducted in the last 25 years, there is no doubt about it,” he said.

“I would tell these people if, frankly, the independence of the bank, the target framework and the nominal anchor are more important than ever. More than in good, easy times. “

Earlier, Mr Stride was asked on Today’s program on BBC Radio 4 whether the Bank of England had failed due to inflation.

The Tory MP stressed that Britain is not “unique”, pointing to the shock of the war in Ukraine.

“Certainly, if you look at the numbers in the headlines that have a target price of 2 percent and go up to 10 percent this fall, it’s not projected to look very good,” he said.

“It is fair to say that we are not unique in this situation – there are a number of countries around the world, the United States, Spain and the eurozone have worse inflation than we do.

“The area where you can really criticize the Bank is around what is happening in the job market, which has become very overheated, and I think we are now in the foothills of the spiral of wages and prices, where wages are chasing rising prices, leading to higher wages in the turn. ‘

Mel Stride

Mel Stride, who heads the Treasury Committee, said the banks’ non-admission of the inflation target was not a “good look”.

Business Secretary Kwasi Quarteng admitted yesterday that the Bank’s failure to meet its 2 percent inflation target was a “clear” problem.

However, he argued that Mr Bailey “did a good job in difficult times”.

“In fact, when the Bank of England became independent in 1997, they had an inflation target of two percent,” Mr Quarteng told Sky News Sophy Ridge on Sunday’s show.

“And inflation is now almost double-digit, so it’s definitely a problem.

“But I think Andrew Bailey is doing a good job in tough times.

“These are absolutely unprecedented times, we had the Covid pandemic, we had a big surge in economic activity after the lifting of restrictions on blocking.

“And then, of course, for the first time in 70 years, you have this war in Europe with tanks entering European territory.

“So it all means it’s a very difficult time and I think he’s doing a smart job.”

He quotes one minister of the Cabinet of Ministers Sunday Telegraph as they say, statesmen “are now questioning its independence.”

They said the Bank’s fight against inflation had raised “fundamental questions” about “the Bank’s readiness and the adequacy of some of these institutions.”

Chancellor Rishi Sunak was also under pressure to take more steps to bring the Bank to justice.

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