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UK announces biggest rate hike since 1989 | UK announces biggest rate hike since 1989 |
(about 2 hours later) | |
The move to tackle soaring inflation may hit thousands of homeowners with higher mortgage costs | The move to tackle soaring inflation may hit thousands of homeowners with higher mortgage costs |
The Bank of England announced the biggest interest rate increase in more than three decades on Thursday. The key rate was hiked by three-quarters of a percentage point in a move to curb inflation. | The Bank of England announced the biggest interest rate increase in more than three decades on Thursday. The key rate was hiked by three-quarters of a percentage point in a move to curb inflation. |
The central bank made its eighth interest rate hike in less than a year, lifting its benchmark rate to 3%, the highest since November 2008. It comes as the regulator predicted a “prolonged” recession for the British economy, which it said could be the longest contraction in modern history, with no recovery until 2024. | |
This is the first meeting of the Bank of England since the premiership of Liz Truss, which created a period of financial turbulence. But while the former PM’s economic policies are now being revised, rising food and energy costs are keeping prices high. | |
The annual inflation rate surged to 10.1% in September, returning to the 40-year high hit in July and five times the central bank’s target. | The annual inflation rate surged to 10.1% in September, returning to the 40-year high hit in July and five times the central bank’s target. |
Bank officials have said they are determined to bring inflation down to 2% and will use higher interest rates to do so even though the measure is expected to hit thousands of homeowners with higher mortgage costs. | Bank officials have said they are determined to bring inflation down to 2% and will use higher interest rates to do so even though the measure is expected to hit thousands of homeowners with higher mortgage costs. |
The move by the British regulator comes on the heels of rate hikes made by the US Federal Reserve on Wednesday and the European Central Bank last week. | The move by the British regulator comes on the heels of rate hikes made by the US Federal Reserve on Wednesday and the European Central Bank last week. |
For more stories on economy & finance visit RT's business section | For more stories on economy & finance visit RT's business section |
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