British businesses should consider official forecasts showing inflation will fall this year when setting their prices, Bank of England Governor Andrew Bailey said on Friday.

"When companies set prices, I understand that they have to reflect the costs that they face," Bailey told BBC Radio.

"But what I would say, please, is that when we are when we are setting prices in the economy and people are looking forward, we do expect inflation to come down sharply this year and I would just say please bear that in mind.

Bailey went on to say he did not have evidence that companies were putting prices up more than necessary. (Reporting by David Milliken and Farouq Suleiman; editing by William James)