Bank of England Deputy Governor Clare Lombardelli has refused to rule out another rise in interest rates in December, keeping the door open to a second increase in as many months as the Bank weighs stubborn inflation against a cooling jobs market.
In an interview with the Guardian published on Tuesday, Lombardelli said she did not yet have enough information to decide how she would vote at the Monetary Policy Committee’s December meeting, but made clear a further move was firmly in play.
“I think it depends what we see on the conflict and the energy prices and it depends what we see in the wider data and how all that fits together,” she told the newspaper. “But I wouldn’t rule it out. Equally, I don’t have enough information just yet.”
Lombardelli voted with the 8-1 majority last week to lift Bank Rate to 4% from 3.75%, the first increase since August 2023. The minutes of that meeting recorded that a further rise was likely to be needed in the near term, and money markets now put roughly a 50% chance on another quarter-point move in December, according to LSEG data.
Her comments add to a drumbeat of hawkish signals from both sides of the Atlantic. In the United States, Federal Reserve Governor Christopher Waller said on Monday that he backed a December rate rise and was open to a half-point move if inflation worsened, a stance that has put borrowers on both sides of the Atlantic on notice of higher costs before Christmas.
The deputy governor’s sharpest warning, however, was about the labour market. Young people in Britain, she said, are bearing the brunt of what she called a “low-gear economy” — a market in which employers have stopped hiring but are not yet shedding staff in large numbers.
“It’s what I call a low-gear economy. So a labour market where you’re seeing a real fall-off in hiring. But actually, we’re not seeing much in the way of redundancies. What’s going on is this kind of low-hire, low-fire dynamic,” she said.
The picture fits the latest hiring data. Britain’s jobs market cooled further in October, with hiring for permanent roles falling for the first time in four months, according to a survey by the Recruitment and Employment Confederation and KPMG published on Monday, only days after the Bank raised rates. Youth unemployment has risen to its highest level outside the Covid pandemic since 2015, while overall unemployment stands at 4.7%.
For households, the prospect of another rise so soon after last week’s increase would add to the pressure on mortgage holders already facing higher borrowing costs. For the Bank, the dilemma is familiar: energy prices pushed up by the war in the Middle East continue to feed into inflation, while the jobs market sends a conflicting signal that demand is fading.
Lombardelli’s interview leaves the December decision genuinely open. With the committee’s next meeting still weeks away, the deputy governor’s message is that the Bank will follow the data — and that, for now, the data point in two directions at once.
Sources: Reuters, “BOE’s Lombardelli does not rule out December rate hike, she tells the Guardian” (https://www.reuters.com/business/boes-lombardelli-does-not-rule-out-december-rate-hike-she-tells-guardian-2026-11-10/); The Guardian interview with Clare Lombardelli, published 10 November 2026.
