The BOE increases interest rates to a 14-year high of 3.5%, after they announced a half-percentage point increase at the latest committee meeting. Officials were torn between balancing the risk of inflation becoming further entrenched or prevent titling the economy into a deeper recession. Jeremy Hunt acknowledged that higher interest rates deliver another blow to UK consumers, but persistently high inflation will prolong the pain to the economy. Despite the latest inflation print indicating that official figures may have peaked, evidence still suggests that inflationary pressures have not begun to fully subside with the labour market still tight and the resilience in wage growth. All of which justifies the need for a strict stance on monetary policy. Following the latest rate decision, the FTSE 100 closed the day lower, whilst Stirling slid against the Dollar.
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The Federal Reserve raises rates by 0.5%
The Federal Reserve raises rates by 0.5%