The central bank boosted its key interest rate by three-quarters of a percentage point, to three percent, after consumer price inflation returned to a 40-year high in September. The violent move comes as the bank forecast a two-year economic contraction through June 2024, which would be the longest recession since at least 1955, according to the Office for National Statistics.[insertAds]
The Bank of England achieved its largest interest rate increase in three decades on Thursday, joining the US Federal Reserve and other central banks around the world in rapid hikes as it tries to beat stubbornly high inflation due to Russia’s invasion of Ukraine and economic policies. disastrous consequences. Former Prime Minister Liz Truss.
It is the Bank of England’s eighth consecutive interest rate increase and the largest since 1992. It comes after the US Federal Reserve on Wednesday announced a fourth straight three-quarter point jump as central banks around the world battle inflation that is eroding living standards. and slowing economy. growth.[insertAds]
The rate decision was the first since the Truss government announced a 45 billion pound ($69 billion Canadian) unfunded tax cut that sparked turmoil in financial markets, pushed up mortgage costs and forced Truss to step down after just six weeks. . Her successor, Rishi Sunak, has warned against spending cuts and tax increases as he seeks to repair the damage and show Britain is committed to paying its bills.