Bank of England will need to raise interest rates faster than the US Federal Reserve, say economists

The Bank of England will have to raise interest rates further and faster than the US Federal Reserve to contain a rise in inflation fuelled by annual energy bills that could rise to £6,000 next year, according to economists and money markets.

Financial markets are pricing in a more than doubling of the 1.75 per cent base rate to close to 4.2 per cent next summer, higher than the US central bank, which is only forecast to peak rates at about 3 per cent. Investors are also betting that the Bank of England will have to raise rates by 75 basis points in November, its biggest single rate increase in history.

Money markets have drastically repriced the path of UK monetary policy this

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