Bank of England on Thursday hiked its main interest rate by 50 basis points to 15-year high of 5 per cent as it combats stubbornly high inflation. The rate hike, which comes a day after the UK inflation data came in higher than expected once again, is the 13th hike in a row.
The 50 basis point hike is higher than Reuters‘ economists poll last week that estimated that the BoE would raise rates to 4.75 per cent, from 4.5 per cent.
The UK inflation stood at 8.7 per cent in May. Britain’s economy, which has been hit by the shock of Brexit as well as the COVID-19 pandemic and the surge in gas prices caused by Russia’s invasion of Ukraine, has dodged a widely expected recession so far in 2023 though growth looks set to be a minimal 0.25 per cent this year, according to the BoE’s forecasts.
(With Inputs from Agencies)
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