The Bank of England Needs a Big Mac and Fries
When the price of a cheeseburger rises for the first time in 14 years, the central bank needs to react.
That burger will cost you 20% more in the UK.
Photographer: ADAM BERRYMcDonald's Corp. has just raised the price of a cheeseburger in its UK restaurants for the first time in 14 years, by a supersized 20% to £1.19 ($1.43) from 99p. Something must be done.
The rising cost of a beef patty is symptomatic of the surge in prices that should prompt the Bank of England to hike its official rate by half a percentage point to 1.75% on Thursday. Inflation running at a 40-year high of 9.4% dictates firmer action than the previous six consecutive increases of 25 basis points or fewer. It would also reflect the 50 basis-point July hike from the European Central Bank, and the three-quarter point Federal Reserve increase last week. Collective action always makes more of an impact.