…By Lola Smith for TDPel Media. The Bank of England has increased interest rates for the 11th consecutive time since tightening its policy in December 2021.
This latest rise puts interest rates at their highest level since the 2008 financial crisis.
The Bank is taking this action to fight inflation, which has been driven up by rising energy prices and supply chain disruptions caused by the pandemic.
This move is expected to put additional pressure on homeowners and businesses.
Next Interest Rates Announcement
The next interest rates announcement is scheduled to be made on Thursday, May 11.
The Monetary Policy Committee will release its MPC Summary and minutes, which will include the current interest rates.
Previous Interest Rates Announcement
The last interest rates announcement was made on March 23.
At that time, the MPC announced that the bank rate was 4.25 per cent, up from 4 per cent.
Expectations for Future Interest Rates
The market predicts that interest rates will continue to rise, with some analysts predicting that rates will reach as high as 4.8 per cent by July of this year.
However, other analysts predict that rates could go even higher, with some suggesting that rates could reach 5.25 per cent.
Capital Economics is predicting that interest rates will rise to four per cent on Thursday, before peaking at 5 per cent this year.
Analysis and Commentary
The decision to increase interest rates is a response to rising inflation, which has become a major concern for the Bank of England.
Inflation has been driven up by a number of factors, including supply chain disruptions caused by the pandemic, rising energy prices, and higher wages.
The Bank of England has been gradually raising interest rates since December 2021 in an effort to cool down inflation.
The decision to raise rates is a balancing act between controlling inflation and avoiding a slowdown in economic growth.
While the increase in interest rates may put pressure on homeowners and businesses, it is important to remember that interest rates are still relatively low compared to historical levels.
Even with the recent rate increases, interest rates are still significantly lower than they were in the early 1990s when they reached as high as 15 per cent.
Overall, the decision to raise interest rates is a necessary step to address rising inflation.
While it may cause short-term pain for some, it is important for the long-term health of the economy.
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