Bank of England may raise interest rates by 75 basis points on Thursday

3 Nov 2022 , 08:45 AM

In an effort to lower the country’s sky-high inflation rate, the Bank of England is generally anticipated to raise its benchmark interest rate on Thursday by the largest margin since 1989.

The BoE is anticipated to increase borrowing costs following a regular meeting by 0.75% to 3%, which would be the highest level since the global financial crisis of 2008.

In response to the highest prices in decades, central banks around the world have been aggressively tightening interest rates.

The US Federal Reserve raised its benchmark lending rate by 0.75 percentage points for the fourth time in a row on Wednesday, bringing it to 3.75—4.0%.

Millions of Britons will see an increase in the cost of living as a result of the BoE decision at 1200 GMT, as central bank rate increases cause retail lenders to raise the interest rates on their own loans.

After Liz Truss, the former British prime minister, frightened markets with her debt-fueled budget, prompting her to quit, and the BoE responded by purchasing UK government bonds on an emergency basis, mortgage payments in the UK have increased significantly in recent weeks.

Early in 2020, as the Covid-19 outbreak started, the BoE cut its benchmark interest rate to a record-low 0.1% while simultaneously injecting enormous amounts of fresh money into the economy.

The Bank of England began raising interest rates in December of last year, and a rate increase on Thursday would be the ninth consecutive increase.

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