British Prime Minister, Rishi Sunak, assured this Sunday that his Government has a “plan that will work” to tackle high inflation in the UK -situated at 8.7%- and emphasized “total support” for the Bank of England to raise interest rates to 5 %.

In an interview with the BBC, the leader story was questioned this Sunday by the latest measure approved by the British issuing bank’s monetary policy committee, which announced last Thursday a half point interest rate hike to its highest level since 2008. “I think the history of the Bank of England, including the Governor (Andrew Bailey), in terms of the old one, relying on the fact that inflation has been well managed and citizens should have confidence that it will come down to the target (from 2%),” he said. .

Sunak reiterated that the bank has “full support” and said that there is “no alternative to bringing inflation down,” which is at “historically high levels,” according to the Office for National Statistics (ONS).

The chief executive acknowledged that the decision to raise interest rates was “difficult” and “not very popular” although maintaining that “it is the right thing for the country in the long term.” “I never said that it would not be difficult, but I want to give assurance to citizens that we have a plan, the plan will work and we will overcome this,” said Sunak, reiterating that “interest rates are the result of high inflation.

In this sense, the conservative leader also stressed that “it must be very clear that what is hurting citizens, what is causing challenges in their daily lives and budgets is inflation.” Following the latest economic indicators, various analysts are predicting that interest rates will reach 6% by early 2024 -meaning their maximum peak in two decades-, which in turn fuels concerns over the consequences of rising mortgage costs in the country.

The Institute for Fiscal Studies in the United Kingdom (IFS), an influential think tank in the country, has warned that rising interest rates could cause the nearly 1.4 million mortgage-bearing Britons to lose 20% of their available financial capacity.

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