Are interest rates set to go higher than anyone thinks possible?

With inflation raging at 10% or more, central banks may have to raise interest rates to similar levels to keep it under control. But have they got the bottle to do that, asks Dominic Frisby?

Governor of the Bank of England Andrew Bailey
Does the Bank of England governor Andrew Bailey have the bottle to “do a Volcker” with interest rates?
(Image credit: © STEFAN ROUSSEAU/POOL/AFP via Getty Images)

I was at a dinner the other night with a buddy who is a much cleverer investor than I am. The conversation went something like this.

Clever Mate: “Inflation is 10%. Rates are going to have to go to 10% to get it under control. I’m 60% in cash.”

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Dominic Frisby

Dominic Frisby (“mercurially witty” – the Spectator) is as far as we know the world’s only financial writer and comedian. He is the author of the popular newsletter the Flying Frisby and is MoneyWeek’s main commentator on gold, commodities, currencies and cryptocurrencies. He has also taken several of his shows to the Edinburgh Festival Fringe.

His books are Daylight Robbery - How Tax Changed our Past and Will Shape our Future; Bitcoin: the Future of Money? and Life After the State - Why We Don't Need Government

Dominic was educated at St Paul's School, Manchester University and the Webber-Douglas Academy Of Dramatic Art. You can follow him on X @dominicfrisby