London Daily

Focus on the big picture.
Sunday, Mar 22, 2026

Bank of England chief says it never feels good to raise rates - but it is their job

Bank of England chief says it never feels good to raise rates - but it is their job

It's critical the Bank of England takes action on rates, the governor of the Bank of England tells Ed Conway.

The head of the Bank of England - responsible for the rise in interest rates - has said it never feels good for central bankers to raise rates but it is their job.

Asked how it feels to be doling out the medicine of interest rate rises, in an effort to reduce inflation, Andrew Bailey said it never feels good for central bankers.

"I don't think anyone should think that central bankers in any sense feel good doing this. But it's our job."

Speaking to Sky News data and economics editor Ed Conway, Mr Bailey said he was doing so to bring down inflation, and that if actions weren't taken, things would get worse.

"Much bigger" job losses could result, he said, explaining that it was critical the Bank takes action.

"I'm afraid if we get into that situation, the action that will have to be taken thereafter to restore stability would be much larger and much more damaging. It's so critical that we take action. So the pain is necessary to prevent something worse."

He denied accusations that the rate rises are bringing about a recession, saying such a statement was unfair. Instead, Mr Bailey placed the blame on economics shocks, the war in Ukraine and high gas and goods prices.

"I don't think it's correct to say that we are precipitating recession. Unfortunately, the UK, along with other countries, particularly European countries, has been hit by a huge shock to national real income. And that huge shock of course, is really to do with the war in Ukraine. And the huge impact it's having on the energy prices, particularly gas prices".

For mortgage holders whose rates have risen the governor said the market rates are too high. More mortgage products should return to the market, he added.

There is some further good news for fixed mortgage holders.

Fixed rate borrowers and been impacted by rates rising "very, very substantially", Mr Bailey said, in the second half of September

"I think the good news is those market prices are now restoring stability. They're coming back down to where they were earlier in September. And that should feed through into the mortgage market."

The number of mortgages on the market has fallen since the mini-budget as the Bank of England reacted and signalled it would increase interest rates to curb inflation. The Bank's statements caused uncertainty among lenders over how much rates would increase and when.

Mr Bailey's comments come after the Bank unveiled the biggest interest rate hike for three decades. It raised the base rate of interest by 0.75 percentage points to 3% and said that the UK is already in recession.

It warned that the UK could face a protracted contraction in the coming years, with high inflation and the unemployment rate climbing to 6.5% - the highest since the financial crisis.

The length of this forecasted recession - eight successive quarters in which gross domestic product shrinks - would make it the most protracted since comparable records began but less deep than most previous downturns, including during the financial crash and the 1980s.

Newsletter

Related Articles

0:00
0:00
Close
Meghan Markle’s Possible UK Return Sparks Renewed Attention on Sussex Role
Starmer Convenes Urgent Talks on Cost-of-Living Pressures Linked to Iran Conflict
Starmer Convenes Urgent Talks on Cost-of-Living Pressures Linked to Iran Conflict
UK Investors Eye Bargain Shares Ahead of ISA Deadline Amid Market Volatility
UK Investors Eye Bargain Shares Ahead of ISA Deadline Amid Market Volatility
Northern Lights Expected Over UK Skies Tonight Amid Strong Solar Activity
UK Condemns Iran Missile Strike and Warns Against Threats to British Personnel
UK Warns of Global Flight Disruptions as Iran Conflict Escalates Under Trump’s Leadership
UK Condemns Iran After Missile Strike Targets Strategic Diego Garcia Base
Deadly Meningitis Outbreak in UK Reinforces Urgency of Vaccination Campaigns
Iran Launches Long-Range Missile Strike on Remote US-UK Base, Signaling Expanded Reach
Iran Launches Long-Range Missile Strike on Remote US-UK Base, Signaling Expanded Reach
UK Rules Out Cyprus Base Role in Joint US Self-Defence Framework
UK Ends Hereditary Peerage Rights in Parliament in Historic Constitutional Reform
Lord Walney Warns of Expanding Iranian Influence Networks Within the United Kingdom
Iranian National Among Two Arrested After Attempt to Access UK Nuclear Submarine Base
Deregulation, Artificial Intelligence, and Fraud Laws Reshape UK Financial Services Landscape
UK Considers Lower Speed Limits to Reduce Fuel Use Amid Escalating Energy Crisis
UK Borrowing Costs Surge to Post-Crisis High as Markets React to Inflation and War Risks
UK Government Prepares Emergency Economic Measures as Iran Conflict Fuels Financial Risks
Meningitis B Outbreak in the UK Raises Urgent Health Warnings as Cases Surge
Iran Issues Stark Warning to Britain Over US Base Access Amid Expanding Conflict
United Kingdom Authorizes US Strikes from British Bases as Iran Threatens Key Shipping Routes
Reform UK Suspends Scottish Candidate Following Financial Misconduct Allegations
Apple issues an unusual warning: this is how your iPhone can be hacked without you doing anything
UK and Nigeria Reach Agreement to Accelerate Return of Irregular Migrants
UK Sets New Aid Priorities Following Significant Budget Reductions
Cyprus President Urges Open Dialogue Over Future of British Sovereign Base Areas
Cyprus President Urges Open Dialogue Over Future of British Sovereign Base Areas
UK Plans 50% Steel Tariffs in Bold Move to Protect Domestic Industry
Iran Conflict Sends Shockwaves Through UK Economy as Energy Costs and Trade Risks Surge
UK Health Officials Warn Kent Meningitis Outbreak Still Active as Cases Continue to Rise
UK Climate Progress Faces Scrutiny Over Reliance on Carbon Accounting Methods
UK Deploys Advisers to United States to Shape Plan for Reopening Strait of Hormuz
Amazon Bets on AI-Driven Alexa Upgrade to Revive UK Smart Speaker Market
UK Abortion Law Changes Spark Strong Response from Church Leaders and Pro-Life Advocates
UK Abortion Law Changes Spark Strong Response from Church Leaders and Pro-Life Advocates
GB News Faces Regulatory Complaints Over On-Air Remarks on ‘Genocide’ Claims
UK Signals Expanded Support for Gulf Allies as Iranian Attacks Intensify Regional Threats
UK VAT Decision Opens Path for Potential Refunds to U.S. Biopharma Firms
UK and Canada Advance ‘Middle Power’ Strategy to Shape Global Influence Beyond Superpowers
Google Explores AI Opt-Out Features in Search to Address UK Regulatory Concerns
Google Explores AI Opt-Out Features in Search to Address UK Regulatory Concerns
UK Fuel Prices Poised to Surge as Global Tensions Drive Oil Market Volatility
UK Fuel Prices Poised to Surge as Global Tensions Drive Oil Market Volatility
UK Holds Back on Hormuz Escort Mission While Continuing Talks with Allies
TrumpRx Pricing Platform Faces Scrutiny as Some Medicines Remain Costlier Than in the UK
UK, Netherlands and Finland Explore Joint Defence Investment Bank to Boost Military Capability
Deadly Meningitis Outbreak in Kent Raises Alarm as Cases Surge and Emergency Response Expands
UK Security Adviser Viewed US-Iran Nuclear Deal as Within Reach Before Sudden Escalation
×