BoE MPC member Catherine Mann said yesterday, “we already have very rapid increase in oil prices… In the U.K., that it becomes embedded by virtue of the institution mechanism of the price cap” on domestic energy bills.
“That embeddedness becomes a domestic inflationary problem that we have to deal with on the monetary policy stage,” she said.
“You only get inflation if businesses raise their prices. That’s where it comes from. It doesn’t come from wage settlements. It comes from businesses’ capacity to raise their prices in a systematic way and sustain demand,” she said.
