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The governor of the Bank of England has warned of “apocalyptic” food prices, saying he is “helpless” to thwart soaring inflation.
Andrew Bailey hit back at criticism that the Bank acted too slowly to tackle inflation, blaming a “bad situation” on a series of external shocks including the war in Ukraine and the lockdown in China.
“We can’t predict things like wars – that’s not in anybody’s power,” he said.
He said he does not think the Bank could have done anything differently to prevent soaring prices.
He said the conflict in Ukraine has pushed up energy prices, which are the biggest driver of inflation – while the lockdown in Shanghai has exacerbated increases in the cost of goods due to its effect on supply chains.
Mr. Bailey said the Bank also underestimated the number of people who would leave the labor market after the threat of the pandemic receded, which is leading to labor shortages that affect inflation.
The consumer price index (CPI) measure of inflation hit 7% in England during March and is expected to pass 10% later this year.
Americans can expect exactly the same situation.