London, Thanasis Gavos
To 1% increased the Bank of England the key lending rate of 0.75%, despite warnings from analysts about a possible recession.
This is fourth consecutive increase in the central bank interest rate, which until December 2021 was at a record low of 0.1%. 1% is the highest key interest rate since 2009.
The new increase was expected by analysts, as inflation has climbed to 7% and is expected, according to the central bank, to reach double digits in the coming months, “slightly above 10%”.
Nevertheless, the Bank today proceeded to first forecast for the course of the national economy after the Russian invasion of Ukraine, warning of the possibility of recession.
Specifically the forecast for growth of 1.25% of GDP in 2022 has been revised to a 0.25% reduction in national product forecast. For 2023, the projected growth rate of 1% has been revised down to 0.25%.
As mentioned, the pressure caused by the huge increases in energy costs is expected to leave signs, raising the unemployment rate and creating the greatest pressure on British households for decades.
It is noted that three of the nine members of the Monetary Policy Committee of the Bank of England voted in favor of an even higher interest rate increase, to 1.25%.
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