The rising inflation in the UK is propelling all pay deals above 4%. A report released by the Income Data Services (IDS) of England shows that the normal pay deal held stable at 3.5% in the preceding three months to April has now crossed one percent more corresponding to the rising level of inflation in the British Isles. One in four payments is now worth 4.2% and the lowest deals hang around about 3%.The rumors of elevated pay settlements are triggering further panics about inflationary stress on the economy. Echoing this Ken Mulkearn, IDS Pay Report editor said, The rising number of private sector deals at or above 4% is a clear indication of the impact that higher inflation is having on pay negotiations. The rising number of private sector deals at or above 4% is a clear indication of the impact that higher inflation is having on pay negotiations. Expressing its concern on Thursday, even, the Bank of England increased interest rates to 5.5%, the maximum level in last six years in order to bring price rises under control.The bank has previously voiced apprehensions that rising Retail Price Inflation to 4.8% which is seen as a yardstick for pay deals, is nourishing through to pay deals and may set off a wage-price twisting. Howard Archer, the Global Insight economist opined that a rush forward in pay deals had yet to happen, as owners had been using bonuses, rather than salary rises, as incentive to their staff. According to him, Consequently, wages have been the one inflation dog that hasn’t bitten – at least yet – although the Bank of England currently has several other price pressures to worry about. Most experts believe that the bank is certain to whip up an interest rise to 5.75% as a tool to restrain inflation. But the real thing that is worrying the common people is a dent in their pockets caused by price rise.