Bank of England raises interest rates to 3.5%
Business / Thu 15th Dec 2022 at 03:07pm
THE BANK of England has raised interest rates by 0.5 percentage points to 3.5% in an effort to combat double-digit inflation that has caused a widespread cost of living crisis reports The Guardian.
Members of the central bank’s monetary policy committee (MPC) voted to increase the cost of borrowing after the consumer prices index (CPI) in November showed annual inflation of 10.7%.
A majority of the Bank’s rate-setting committee said the ninth increase in the base rate over the last year was necessary to bring down inflation by 2025 to its 2% target.
The move takes UK rates to the highest level since October 2008, and comes despite expectations that the UK is falling into a long recession. However, it marked a slowdown in the pace of rate rises, after the MPC increased borrowing costs by 0.75 percentage points at its meeting in November.
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