The Bank of England governor has said industry lobby group the British Retail Consortium (BRC) was right to warn of job losses as a result of the budget.

There is a “risk” of unemployment rising due to increases in employers’ national insurance contributions and minimum wage rises announced by Chancellor Rachel Reeves last month, Andrew Bailey told MPs on the Treasury Committee.

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In a letter to Ms Reeves, the BRC warned of items becoming more expensive and job cuts stemming from the price pressures placed on firms by the new policies.

But firms will rebuild their profit margins, according to Mr Bailey.

He said: “Probably initially there will be more pressure on firms’ margins because it takes them longer to adjust and then they’ll probably rebuild those more profit margins, that is over time”.

Having previously said the budget could cause inflation to rise, Mr Bailey on Tuesday said price increases could slow or reverse thanks to the budget policies.

Fewer jobs would reduce competition among employers for workers, something which could bring down wages.

Wage rises have been one of the factors identified by Mr Bailey as behind high inflation since the COVID pandemic.

How much will borrowing costs fall by?

A member of the Bank’s interest rate-setting Monetary Policy Committee, Professor Alan Taylor, told the MPs he expects interest rates to fall to 3.75% over the next year – down from the current 4.75%.

Interest rates could be lowered more quickly, he added, if inflation, wage growth and economic expansion are less than anticipated and unemployment ticks higher.

Why are mortgage rates going up?

When asked why typical fixed-rate mortgages have been going up in recent weeks, Mr Bailey said it was because of US political uncertainty before the election as well as the UK budget.

He pointed out that since the first interest rate cut in four years, announced in August, mortgage rates in the market have been lower.

Brexit and its hardline supporters

Echoing comments he made about Brexit and the need for increased cooperation with the European Union, Mr Bailey also levelled criticism at hardline Brexiteers.

“We should be in active dialogue with the EU,” he told MPs.

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The reason there have been outcomes “better than we feared they would be in 2016-17” for the financial services sector is because of open dialogue with EU colleagues, Mr Bailey said.

“I find it hard to understand people who seem to say that we should implement Brexit in the most hostile fashion possible.”

He added: “I take no position on Brexit. I never have. I’ve always said it’s my job to get on and do it and I’ll do it in the best way possible and I think talking, having a relationship with the European Union is the better way to do it.”

The scandal-hit Post Office has moved to cut its senior leadership team by half under efforts to reduce costs and bolster the business’s damaged culture.

New chairman Nigel Railton told a committee of MPs the move was started just moments after his transformation plan – a major effort to turn a page on the Horizon IT scandal – was revealed to Post Office staff last week.

He also confirmed that the total cost of the initiative, yet to be agreed with ministers, had been estimated at £1.2bn.

That sum, he said in his evidence to the business and trade committee, included the projected cost of a replacement for the Horizon accounting system.

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Mr Railton did also not deny that he could consider his position if the bill was not approved by the government.

The transformation plans could lead to more than 1,000 job losses through the closure of more than 100 so-called crown branches which currently lose significant amounts of money.

On top of that headcount figure are planned cuts to head office roles.

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While no total has been set Mr Railton, who succeeded Henry Staunton after he was sacked by-then business secretary Kemi Badenoch in January, confirmed that it was in consultations with 30 out of 64 members of the current senior leadership team.

The wider transformation proposals include an aim to boost postmaster pay by a combined £250m over five years in a bid to remedy long-held complaints over remuneration.

The MPs held their evidence session as the public inquiry into the scandal nears its conclusion, with just closing speeches to be made ahead of the publication of the findings next year.

The compensation and redress issue is continuing to dominate the fallout amid the criticism over delays after the blanket quashing of wrongful theft convictions linked to the faulty accounting system software.

The MPs’ raised concerns, that were supported by witnesses including Mr Railton, that the redress schemes still needed to go faster despite some improvements in processes.

Attention is, however, also turning to potential prosecutions connected with the scandal though such charging decisions could take years to materialise.

Sky News revealed on Monday that police, who have been monitoring evidence and submissions to the inquiry, are investigating up to four individuals to date on suspicion of offences including perjury.

Ministers are considering a new ownership model for the business, which could result in an employee-owned future akin to the John Lewis Partnership structure.

A woman whose body was found in the boot of a car last week died from strangulation, according to a post-mortem examination.

A manhunt is under way for Harshita Brella’s husband, Pankaj Lamba, who police believe has fled the country.

Officers said today that her body was discovered in a silver Vauxhall Corsa.

They believe she was killed on the evening of Sunday 10 November and driven in the early hours from the couple’s home in Corby, Northamptonshire, to Ilford in east London.

It’s understood the 24-year-old had been under the protection of a court order for victims of domestic abuse.

Northamptonshire Police said officers began searching for her after receiving a call with concerns for her welfare on 13 November – the day before she was found dead.

A post-mortem examination found Ms Brella’s preliminary cause of death was strangulation, police said.

New CCTV images of Pankaj Lamba, 23, have also been released as the manhunt continues.

Detective Chief Inspector Johnny Campbell, from the East Midlands major crime unit, said: “We suspect Harshita’s body had been placed in the boot of the vehicle by Lamba before leaving Corby.

“Lamba then abandoned the vehicle in Brisbane Road, Ilford, and made his getaway.”

Northamptonshire Police, the East Midlands major crime unit and the National Crime Agency are working together to try to find him.

An inquest into Ms Brella’s death will be opened on 20 November at The Guildhall in Northampton.

Anyone who thinks they might have seen Pankaj Lamba is urged to make contact as soon as possible.

“Any information, no matter how small, may be relevant to the investigation and help us get justice for Harshita,” said DCI Campbell.

People with relevant information can call 101, Crimestoppers anonymously on 0800 555111, or online at mipp.police.uk