The governor of the Bank of England (BOE), Andrew Bailey, defended his decision to raise interest rates by saying the real risk of rising prices was 'rooted'.
In an interview with BBC Radio 4's Today programme, Bailey said they were acting as inflation continued and it had not come down as expected.
He also expressed concern over rising UK inflation as companies are having trouble hiring the workers they need, prompting them to raise prices.
The statement indirectly helped explain why the UK central bank raised interest rates at yesterday's policy meeting.
Interest rates have been raised to 1.75%, the highest increase in 27 years where inflation is now expected to reach over 13%.
UK economic growth forecasts have been downgraded this year with the longest downturn forecast since 2008.
A rise in interest rates is a way to counter inflation because it increases the cost of borrowing.
This will encourage households to reduce spending and borrowing, while also encouraging people to save more.
However, households will be further squeezed following the increase in interest rates including some mortgage holders.
