Economists have warned that 'groupthink' is stopping the Bank of England raising interest rates to control inflation that could go as high as 6 per cent.

at its last meeting, the mpc voted unanimously to keep the level at the record low of 0.1 per cent- double its target.

speaking about the reason behind the increases, mr patricio said this was because of a lack of truck drivers.

He told the BBC consumers will need to get used to paying more for food due to the world's rising population and a lack of land to grow produce.

But he also said firms would have to take on the cost rises, adding :' I think it's up to us and to the industry and to the other companies to try to minimise these price increases. '

Michael Saunders, who sits on the Bank's interest rate-setting Monetary Policy Committee ( MPC ), hinted at the weekend that rates could be hiked as early as this year.

Markets are starting to price in a December rate hike and in an interview with the Sunday Telegraph Saunders suggested this might not be far off the mark.

Bank of England governor Andrew Bailey is coming under increasing pressure over the stance on inflation and interest rates

However, it would also see an increase in bills for many UK households, pushing rates higher on mortgages and putting pressure on businesses that had taken on debt during the coronavirus pandemic.

The nine-strong committee will reconvene in November and December.

However, two MPC members voted against continuing with quantitative easing at its existing level.

However, it stated that in August based on the market's expectations at the time for interest rates, 'CPI inflation was expected to fall back to close to the 2 per cent target in the medium term '.

The ongoing energy crisis and a shortage in the Labour market is fuelling a rise in prices (Image: Getty)

It said : 'Since the August MPC meeting, the pace of recovery of global activity has showed signs of slowing.

'Some financial market indicators of inflation expectations have risen somewhat, including in the United Kingdom. '

consumers will also be stung by boris johnson's national insurance hike to fund social care in april, while council tax is expected to rise steeply too.

'Let us hope the Chancellor has some rabbits up his sleeve at the end of the month to provide relief.

Later life mortgages (Image: Express)

Julian Jessop claimed the Bank of England's Monetary Policy Committee could hike its base rate from the current record low of 0.1 percent to as much as 0.5 percent.

However, the "Brexit optimist" academic warned people not to panic because this would still represent a lower rate than the 0.75 percent in place before the pandemic struck at the beginning of last year.

READ MORE : Insulate Britain protester unleashes on Julia Hartley-Brewer "And higher inflation at least keeps real rates low.

"Other CBs ( Central Banks ) are already raising rates or reducing asset purchases.

The headline CPI rate of inflation hit 3.2 per cent in August and is expected to rise further

It comes as investors are reportedly bracing themselves for a string of interest rate rises to rein in rising inflation.

This has been fueled by the UK's current supply chain crisis and the reopening of the economy from the Covid pandemic.

Samuel Tombs, the chief UK economist at Pantheon Macroeconomics, said : "We think markets are jumping the gun in how quickly the MPC will hike rates."

Raising interest rates would help reign in inflation.

Michael Saunders hinted that rates could even rise before the end of this year (Image: PA)

Barclaycard said 90 % of the shoppers it surveyed were concerned that the rising cost of everyday items would have a negative impact on their household finances.

In a speech shortly after the meeting in September, the Bank's governor, Andrew Bailey, emphasised "the hard yards" the UK economy must travel before it regained the same level of activity and income achieved before the pandemic, signalling that rate rises planned for next year may be delayed.

However, Bailey said in an interview with the Yorkshire Post on Saturday that he was concerned about inflation and uneasy about consumers beginning to see the rise in inflation as a permanent feature.

A rise in unemployment before the end of the year would probably persuade the MPC that a rate rise would make the economic situation worse.

Bank of England Governor Andrew Bailey (Image: Getty)

Helen Dickinson, the BRC's chief executive, said the problems with shortages were far from over and called on the government to make further efforts to intervene.

He added that the labour shortages "across many sectors" was “ likely to push up pay growth, and indeed already seems to be".

"I don't see any point in going around sort of looking at petrol stations at the moment because as far as I can tell, none of them have any and if they do, there ’ s a queue a mile long," he said.

Mr Saunders has personally responded to the current shortages of fuel by taking up cycling.

Kraft Heinz chief Miguel Patricio said the firm is 'raising prices, where necessary, around the world'

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