Yahoo Finance Some retailers are overcharging customers, warns Bank of England
There is some evidence that retailers are overcharging customers, the governor of the Bank of England has said.
Andrew Bailey told the BBC that there are some issues to tackle on overpricing.
“If you look at petrol prices, some sellers of petrol have possibly been charging too much for it,” the governor said.
The Bank of England boss suggested that moves by regulators on retail prices, especially in the fuel market, would help to lower inflation.
"That's important. It helps us with inflation, but it's just fairer if these things are tackled. This is having very difficult effects," Bailey said.
Read more: Mortgage rates: Average five-year fix goes above 6% for first time this year
Recently, the competition watchdog said drivers were paying more for petrol and diesel than before the COVID pandemic because of “weakened” competition. Supermarkets have also been accused of greedily fuelling inflation at the expense of their customers.
Bailey also warned that chocolate bars are likely to keep rising in price, even if inflation falls, due to the surge in sugar prices.
Loving this Bank of England governor interview on @BBCNewsround
Presenter: if you forgot your wallet at home, can you pitch a note or two?
Andrew Bailey: I think that would be a very bad idea
😂— Victoria Scholar (@VictoriaS_ii) July 6, 2023
The Bank of England governor admitted inflation remains high and the impact of rising interest rates have on UK households.
“Inflation is way too high. We have a target that prices should rise by no more than 2%. It is, sadly, above that at the moment, above 8%.
"I understand it is difficult. People are having to make very difficult choices about what they buy, what they need for their lives,” he said.
“It will have more of an effect on young people, younger families. I do understand this.
“We want to get inflation back to where it needs to be, and then we can assess what level interest rates should be at,” he added.
Read more: Fuel: UK drivers pay extra 6p per litre amid weak supermarket competition
Bailey, however, declined to speculate on when borrowing costs might fall.
"I can't give you a date as to when interest rates start to come down because that really depends upon what happens over the period of time ahead, but getting inflation down is the most important thing that we have to do," he said.
UK inflation hit a 41-year high of 11.1% in October 2022 and held at 8.7% in May.
Watch: How does inflation affect interest rates?
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