The Bank of England hiked short-term interest rates by seventy-five basis points as it continues to battle inflation.

In his press conference following the announcement, Andrew Bailey spoke of the UK facing the prospect of its longest recession in history. While it won’t rival the recession caused by the Pandemic for depth, it will continue well into 2024.

Following its biggest hike since 1989, the eventual high may reach 5.25%. Bailey believes that rising inflation will moderate quite soon and begin to fall in the second quarter of 2023.

Meanwhile, the country faces the prospect of a significant economic contraction, with unemployment doubling from its current level of 3.5%, its lowest level since 1974.

Bailey was unabashed about the Bank of England continuing to hike interest rates despite the country facing a tough couple of years, saying that the situation would be far worse if prices continued to rise unchecked.