The Bank of England: Following Friday’s expensive budget, which raised concerns about the state of the public finances, the statement came as government borrowing prices skyrocketed.
If present market circumstances persist, there is a “material risk to UK financial stability,” the bank continued.
According to a statement released on Wednesday, the bank “stands ready to restore market functioning and minimise any risks from contagion to credit conditions for UK families and companies.”
Analysts have cautioned that in order to attempt to reduce decades-high inflation, the BoE would need to increase interest rates even more forcefully in the upcoming months.
The bank increased its benchmark interest rate by a half point last week to 2.25 per cent.