"There's a lot of uncertainty around this situation," Mr Bailey said. "And that is a major, major worry and it's not just I have to tell you a major worry for this country. There's a major worry for the developing world as well. And so if I had to sort of, sorry for being apocalyptic for a moment, but that is a major concern."
He insisted that most of the above-target inflation was due to global prices not domestic factors.
"80% of the overshoots over the target... is due to energy and tradable goods," he said.
Asked whether he has felt helpless given the situation, Mr Bailey admitted he had.
"It's a very, very difficult place for us to be in," he said.
The surge in the cost of living has led to households cutting back their spending, which is hitting growth.