With the potential of an economic recession, the Bank of England is anticipated to increase interest rates by 75 basis points tomorrow, Thursday. This would be the greatest increase since 1989.
The bank is anticipated to increase the main interest rate for the eighth consecutive time, amid expectations that the double-digit growth momentum and the major fiscal policy will reduce invitations to further tightening of the money supply. With the rise in inflation in the UK to the highest level in 40 years, at 10.1% last September, the bank is expected to do so.
Financial and monetary policy are no longer moving in opposing directions as a result of the controversial tax cuts that the administration of new Prime Minister Rishi Sonak, who succeeded Liz Trace, implemented.
The Goldman Sachs economists cut their forecast for growth in the UK from -1 to -1.4% annually on Monday, adding that the Sonak government’s plan to help with household and commercial energy prices is likely to be less generous.
Citation: CNN.
Expert predictions regarding the interest rate were made hours before the England Bank meeting.
About Author
