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Emma Walsh

BoE Raises Interest Rates To 4%

As part of its summary, the MPC said the decision comes as global consumer price inflation remains high, although it is likely to have peaked across many advanced economies


Summary

  • The Bank of England raises its base rate from 3.5% to 4% - the highest in 14 years..

  • It also says the UK is set to enter recession this year but this will be shorter than previously thought.

  • The Bank of England expects the economy to "fall slightly" in 2023 as energy costs and other prices continue to ease.

  • It also forecasts that the inflation rate will continue to slow this year and firms are likely to hold off on making redundancies.

  • A higher interest rate will be welcomed by savers, but have a knock-on effect for those with mortgages, credit card debt and bank loans.

  • The 4% rise means people with a typical tracker mortgage will pay about £49 more a month - while those on a variable mortgage will pay another £31 a month.



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