Rising inflation could trigger global sell-off that would harm UK, says Bank

Risky asset prices in several markets are at historically high levels and could be primed for sharp fall, it adds

• UK faces grim winter' as costs of living rises accelerate
• Watch out for shrinkflation', warn analysts

The Bank of England has warned that rising inflation could trigger a sell-off in global financial markets, with damaging consequences for the UK economy.

Against a backdrop of soaring energy prices and severe shortages of workers and materials, Threadneedle Street said inflationary pressures were rising as the pace of economic recovery from the pandemic slows.