Bank of England policymaker Catherine Mann said on Thursday a pick up in inflation was unlikely to lead to longer-term price problems in Britain's economy, and that global volatility had weakened the case for a gradual approach to cutting rates.

The Bank of England should adopt a more activist approach to setting interest rates in order to deal with the “substantial volatility” affecting geopolitics and financial markets, a rate-setter has said.

An "age of uncertainty" over the path of inflation, means rapid UK interest rate cuts are unlikely, Bank of England officials said.

Deutsche Bank now forecasts inflation could soar to 4.25% by summer, making further rate cuts a dangerous move. Chief UK economist Sanjay Raja warned that interest rate reductions might have to be “more backloaded than frontloaded” – meaning the BoE could be forced to hold off on cuts for longer than expected.

A Trump trade war risks making Britons poorer and tariffs are the wrong way to solve economic problems, Bank's Governer warns MPs

Inflation could hit 4 per cent this year if the Bank of England's forecasts only slightly exceed expectations. Yesterday, inflation unexpectedly jumped to 3 per cent in January, hitting its highest level in 10 months and higher than the 2.8 per cent financial markets had forecast.

Increased uncertainty suggests that the Bank is likely to reduce interest rates more gradually, the policymaker cautioned.

Dave Ramsden, who is the bank's deputy governor for markets and banking, pointed to the combination of rising inflation and weak economic growth.

Britain's headline rate of inflation hit a 10-month high of 3% in January and the Bank of England forecasts it will climb further to 3.7% later this year, while industry researcher, the Institute of Grocery Distribution has forecast food inflation could hit nearly 5% this year.

Bank of England policymaker Dave Ramsden has backed ... pointed to the combination of rising inflation and weak economic growth. While the Bank cut interest rates to 4.5% at its February meeting ...

“Given the increased uncertainty and risks to inflation on both sides … I am even more certain than I was that taking a gradual and careful approach to the withdrawal of monetary restraint is appropriate.” Andrew Bailey, Governor of the Bank of ...