Bank of England raises interest rates by 0.5 percentage points to 4% via IrishTimesBiz
“If there were to be evidence of more persistent [inflationary] pressures, then further tightening in monetary policy would be required,” the MPC said in a statement agreed by all nine members.
The new statement, which makes further increases conditional on bad inflation news, suggests interest rates might peak at the new rate of 4 per cent, lower than the 4.5 per cent expected by financial markets.Brendan Burgess joins the podcast to explain his critique of Central Bank policy on mortgage interest rates.
There was no attempt by the BoE to suggest that financial markets were misguided in expecting interest rate cuts later this year. But the committee made it clear it needed to see evidence that underlying inflation was coming down and it was not yet declaring victory. MPC members said they judged “that the risks to inflation are skewed significantly to the upside,” which underpinned the majority’s continued concern about price rises and justified the large interest rate rise on Thursday. – Copyright The Financial Times Limited 2023
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