Inflation is forecast to hit a 50-year high of more than 18% in January, Citi has warned.
The investment bank warned that inflation was “entering the stratosphere”, and would hit the highest rate among larger western economies.
It said the Bank of England might be forced to raise interest rates from the present level of 1.75% to as high as 7% to stop price increases becoming embedded.
The Bank of England expects inflation, currently at 10.1%, to peak in October at 13%. A surge in global gas prices has led many private sector forecasters to project a higher spike at the start of 2023, with the Resolution Foundation predicting 15%.
