Inflation is the focus of the Bank of England’s (Central Bank) decision to raise interest rates, according to Governor Andrew Billy, who also noted that “if we do not act strongly now, the situation will be worse later.”
This was stated during a press conference following the Bank of England’s decision to increase interest rates by 0.75% on Thursday, the highest rate since 1989. The move was made in an effort to lower inflation, which had risen to its highest level in 40 years.
“These are significant changes that actually affect people’s lives. Simply put, we decided to boost the interest rate because the bank’s goal has successfully lowered inflation despite its high level “Billy tacked on.
“We made our choice today because we believe that people shouldn’t have to worry about inflation while going about their regular business. If we do not act firmly now, the situation will be worse last to,” Billy said.
According to the Independent newspaper, Billy, a “British,” cautioned that the gross domestic product will continue to decline until 2024, stating that “in the best collective appreciation of the Monetary Policy Committee, GDP will continue to shrink from 2023 until 2024.”
The decision of the Bank of England today to raise interest rates by three quarters of a percentage point, to be the British Central one of the first major central banks to move to curb inflation, and this is the eighth consecutive increase of interest rates to reach 3 percent of 2. 25 percent and is the highest since the global financial crisis in 2008 .
After the British Central decision was announced, the pound decreased by around 2% to $ 1. 1181.
The Monetary Policy Committee at the Bank of England voted in favour of this hike by 7 members in favour and 2 members against it. One member supported a 0.5% increase, while the other member favoured a 0.250% rise.
As it increased to 10.1%, the inflation rate in Britain reached levels unseen in nearly 40 years.
The British Central expected that economic growth will continue to shrink, for eight consecutive quarters, throughout 2023 and the first half of 2024, as high energy prices and tightening financial conditions affect spending.
In terms of inflation, the Bank of England predicted that it would fall to 2.2% by the fourth quarter of 2024 and to 0.8% by the same quarter in 2025.
The Governor of the Bank of England after raising the interest at a rate that did not happen 30 years ago: If we don’t act quickly, the results will be worse.
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