Reuters: Bank Of England Is Likely To Raise Interest Rates Once Again
In an effort to control inflation that is on its way to reaching 40-year highs in the midst of a depreciating national currency and increased government spending, the Bank of England is expected to hike interest rates once more by at least 50 basis points. Financial markets are anticipating a rate increase to 2.5 percent, but economists surveyed by Reuters forecast that the Bank of England will boost rates to 2.25 percent from 1.75 percent.
The Bank of England is also anticipated to announce shortly that it intends to sell a portion of the $944 billion package of government bonds totaling 838 billion pounds that it has purchased during the course of the bank’s over ten-year quantitative easing program.
The largest rate increase since 1995 occurred in August when the U.K. central bank increased interest rates by 50 basis points. If the rate grows by 75 basis points on Thursday, it will be the largest increase since 1989, except for the rate hike in 1992 intended to support the national currency.