The Bank of England has embarked on a series of necessary economic shocks. British Prime Minister Liz Truss’ plan to cut taxes weakened the national currency against the dollar and led to a sharp increase in government bond yields. So now the implications of all of the above make it even more difficult for the bank manager to convince the markets that he can tighten monetary policy. His decision on Wednesday to buy government bonds while postponing plans to sell his £857bn bond portfolio comes with serious risks. But it could contribute to a much-needed rate hike. The unjustified Lees Truss tax cut, unveiled last Friday, has caused turmoil in the bond markets. Yields on 10-year bonds have since risen by more than a percentage point as investors turned away from British assets amid fears of a boom in government spending and rising inflation. Mr. Bailey is being asked to reassure investors that he will act late to stem the rise in prices. This means he will be willing to raise interest rates even at the expense of economic growth and rising borrowing costs for homeowners and businesses.

There is a risk of giving the impression that the Bank of England is funding Liz Truss’s unorthodox policies.

Bank of England medicine can only partially cure the disease in the UK. The turmoil comes at a particularly inopportune time because, like the Fed, its counterpart in the UK is preparing to reverse its quantitative easing policy. This includes reducing the portfolio of bonds purchased during the recent financial and economic crises. Andrew Bailey’s goal is to cut assets by £80bn next year. This so-called quantitative tightening will require asset managers and investors to buy more bonds, even if the government is forced to borrow. This prospect spooked the markets. By Wednesday morning, 30-year UK Treasuries, for example, were down more than 20% from Friday.

So the BoE’s reaction to what it called “dysfunction” in the markets is both logical and effective, as bond yields have declined since its announcement. But it comes at a cost. There is a clear danger that the bank will give the impression that it is subsidizing the government whose outlandish policies have caused unrest.