Kwarteng attacks Bank of England with inflation predicted to hit 13%

theguardian.com:

The business secretary, Kwasi Kwarteng, has criticised the the Bank of England’s control of inflation, saying “something had clearly gone wrong” at the institution as prices are predicted to rise by 13% and the UK is forecast to suffer an economic downturn lasting more than a year.

As a key supporter of the foreign secretary, Liz Truss, the frontrunner to be the next Tory leader and prime minister, Kwarteng’s comments suggest the Bank’s independent mandate to keep inflation at 2% may be re-examined if she takes over at No 10.

Kwarteng told Sky News: “The job of the Bank was to deal with inflation. They’ve got a 2% inflation target, that’s actually their mandate. And now inflation is getting double digits. So clearly, something’s gone wrong.”

He added: “I think there is an issue about how the Bank is operating because clearly if I say to you 2% is your target, and you say to me, ‘Well, actually it’s going to hit 13%,’ I would quite rightly say something’s gone wrong. We’ve got to look at how you’re performing.”

Kwarteng also said the Bank should have acted quicker to increase interest rates in an effort to control inflation. He said: “I think there is an argument to suggest the rate should have probably gone up slightly sooner.”

When asked if the Bank would keep its independence, he said “absolutely” but also described potential interventions.

“We need to look again at what the mandate is and how best they can actually fulfil that mandate,” he said, adding: “You’ve got to look at how the Bank is organised and what the targets are.”

However, the Bank’s governor, Andrew Bailey, defended its performance, insisting it had not acted too slowly to raise interest rates because it was important to defend the economy in the wake of