Eli5, why are interest rates raised slowly every month rather than in one bigger chunk when inflation is so high?

Question

Every month the BofE raises the interest rate bit by bit, knowing inflation is so high and knowing they had to raise the rates quite high, why do it so slowly?

In: 35

Answer 1

Short answer: rasing interest rates has its own costs to the economy, and significant jumps carry much higher costs, so they only want to do it by the absolute mimimum they need to.

​

given the Economy is an almost incomprehensibly complex machine of feedback loops and confidence games, its basically impossible to accurately predict the amount they need to jump to ahead of time. Ergo, the make smaller, more mesured inceases, which give people time to adjust to each raise and can better see how much they need to go.