UK News

The Bank of England increased bank rate to 2.25 per cent

Share

THE Bank of England increased bank rate to 2.25 per cent on September 22, as it sees Britain floundering into recession, just one day before new Prime Minister Liz Truss and Chancellor of the Exchequer Kwasi Kwarteng unveil their plans to save the economy.

There is little doubt that the currently independent Bank of England and the new Government will quickly be at daggers drawn as they simply don’t agree on a policy for the country’s way forward.

At the same time as raising the interest rate by 0.5 per cent, the Monetary Policy Committee (MPC) also voted unanimously to reduce the stock of purchased UK government bonds, financed by the issuance of central bank reserves, by £80 billion over the next twelve months, to a total of £758 billion.

Effectively whilst the Government needs more money to finance its plans, not only will be Bank be making less money available, it will also make borrowing from the commercial market more expensive for the Government.

Inflation fell slightly in August to 9.9 per cent but the Bank of England has a target set at 2 per cent which it seems to believe can only be reached by limiting the money available to both consumers and businesses.

Mortgage rates will continue to increase and it is debateable whether companies will be comfortable in spending more money in investments when they are facing huge increases in prices, even with promise of caps on energy costs which are at best, short term measures.

Thank you for reading The Bank of England increased bank rate to 2.25 per cent’ and remember that all articles produced by Euro Weekly News may be accessed free of charge.

Guest Writer



Recent Posts

  • Spain

Temperatures are set to plummet across Spain

Temperatures are set to plummet across Spain on as a high-pressure trough descends on the…

4 mins ago
  • Costa Blanca North

Teluda-Moraira to host the prestigious underwater photography competition

The competition "XIV Open FotoSub GEAS" will commence on Friday, September 30. (more…)

11 mins ago
  • Spain

Civil guard officer sentenced to 53 years in prison for abusing 11 children

 A civil guard officer has been sentenced by a court in Huesca to serve 53…

30 mins ago
  • Costa Blanca South

Benitatxell to increase the number of parking spaces to anticipate future needs

In El Poble Nou de Benitatxell parking is not a concern. (more…)

31 mins ago
  • Costa Blanca South

Elche’s Espacio Hernandiano to give a voice to writers

To commemorate the anniversary of Miguel Hernandez's birth Elche proposes to give a voice to…

45 mins ago
  • USA

BREAKING: Police responding to active shooter at St. Vincent Hospital in Sherwood, Arkansas

Armed police are responding to reports of an active shooter at St. Vincent Hospital in…

50 mins ago