The United Kingdom’s central bank on Thursday warned that the British economy is at the risk of plunging into the longest recession since records began, the BBC reported.

A recession is when the economy stops growing and starts shrinking. It occurs when the value of goods and services produced in a country, known as the gross domestic product, declines for two consecutive quarters or half a year.

On Thursday, the Bank of England announced its biggest interest rate hike since 1989 after consumer price inflation rose to a 40-year high in September. The central bank lifted its key policy rate to 3% from 2.25% to bring down the soaring prices fuelled by Russia’s invasion of Ukraine and the economic policies of former Prime Minister Liz Truss.

The bank warned of a “very challenging” economic outlook ahead as the British economy might not grow for another two years – longer than during the 2008-’09 financial crisis.

During this period, unemployment would likely increase from 3.5% to nearly 6.5%, the bank predicted.

“If we don’t take action to bring inflation down, it will be worse later on,” Andrew Bailey, the governor of the bank, said at a press conference on Thursday. “There is no easy outcome to this.”

Central banks across the world are facing similar challenges as inflation has skyrocketed over the past year.

After the Bank of England’s decision on Thursday, UK Finance Minister Jeremy Hunt said that getting inflation under control was the government’s top priority.

“Inflation is the enemy and is weighing heavily on families, pensioners and businesses across the country,” he added. “Interest rates are rising across the world as countries manage rising prices largely driven by the Covid-19 pandemic and [Russian President Vladimir] Putin’s invasion of Ukraine.”