Raising costs could drive up the average cost for many everyday items much further and would hurt the most un-well-off most, the Bank of Britain lead representative has cautioned firms.
"Assuming all costs attempt to beat expansion we will get higher expansion," Andrew Bailey told the BBC's Today program.
He said higher expansion "harms individuals" and cautioned the Bank would raise rates once more assuming that costs kept on expanding.
Mr Bailey was talking a day after the Bank raised financing costs to their most significant level for a considerable length of time
The move came after costs bounced suddenly the month before.
"I would agree to individuals who are setting costs - if it's not too much trouble, comprehend, in the event that we get expansion implanted, loan fees should go up further and higher expansion truly helps no one," he added.
Taking off expansion in the UK and all over the planet has been crushing families' funds as energy and food costs rise.
Cost for most everyday items pressures hit the most un-well-off hardest, on the grounds that they spend a greater piece of their pay on food and fuel.
The Bank has been consistently expanding loan costs as it looks to make acquiring cash more costly and urge individuals to spend less, determined to stop costs rising so rapidly.
Be that as it may, higher financing costs likewise hit certain individuals with existing credits like home loans.
How the loan cost rise affects you
Mr Bailey said firms ought to remember that the pace of expansion is probably going to drop strongly this year.
He said he had not yet seen proof of organizations setting up costs more than needed, and said that he comprehended they expected to "mirror the costs they face".
'Cafés previously enduring a shot'
Responding to Mr Bailey's advance notice, Martin Williams, CEO of Uncommon Cafés, which incorporates the chains Gaucho and M, said that organizations had proactively been limited in raising costs.
"Assuming eateries had mirrored the inflated 'costs they face' in the previous year as Mr Bailey proposes, a straightforward side serving of mixed greens would be estimated at £20," Mr Williams said, adding that lager would be £20 per half quart, and a little steak would be £100.
He said eatery proprietors had "mindfully attempted to adjust continuing evaluating low, and keeping their organizations reasonable" while confronting flooding compensation, food and energy bill costs.
Energy bills support for organizations will turn out to be less liberal from April, with exchange bunch UK Friendliness saying in January it would prompt a 82% ascent in bills for firms like bars, cafés and lodgings.
"That will hit business visionaries, new companies unimaginably hard," said Mr Williams. "The effect will be the conclusion of cafés."
UK Accommodation's CEO Kate Nicholls said no business needed to raise its costs because of a paranoid fear of losing deals. "It is a minor wonder that many have held off increments however long they have," she said.
To propose the area "stomach these amazing expense increments overlooks what is going on" confronting numerous organizations across the UK, she added.
"Actually without satisfactory government support, doing as the lead representative asks will simply mean business disappointment and employment misfortunes."
An administration representative said it had given an "remarkable" energy support bundle for firms, "and further help from April onwards".
Exploitative case
Mr Bailey's remarks came after Tesco administrator John Allan said in January that food firms might be blaming expansion so as to climb costs farther than needed.
Last year, Mr Bailey approached laborers to not request enormous compensation rises, igniting a reaction from associations.
The rate at which costs are rising remaining parts near its most significant level for a considerable length of time, hitting 10.4% in the year to February - in excess of multiple times the Bank of Britain's objective.
Higher food costs are one of the primary drivers fuelling in general expansion, with the expense of regular essentials, for example, eggs, cheddar and milk rising pointedly.
UK banks 'safe'
Mr Bailey likewise said he accepted the UK banking framework was "no problem at all" following the new breakdown of two US banks and the salvage of Swiss moneylender Credit Suisse.
"We have banks that individuals can depend on, and that is basic," he said. "I needed to manage a great deal of issues in the worldwide monetary emergency when we were not exactly in that particular situation constantly, can we just be real."
He likewise said that the gamble of downturn for the UK "has gone down a considerable amount", adding that the possibilities for monetary development are "presently significantly better".
Raising costs could drive up the cost for many everyday items much further and would hurt the most un-well-off most, the Bank of Britain lead representative has cautioned firms.
