The Bank of England is widely expected to hold interest rates as inflation stays above target
The Bank of England is widely expected to keep interest rates unchanged after official figures showed Inflation in the U.K. holding steady at an annual rate of 2.2% in August, with higher airfares offset by lower fuel costs and restaurant and hotel bills
LONDON (AP) — The Bank of England is widely expected to keep interest rates unchanged on Thursday, a day after official figures showed inflation in the U.K. holding steady at an annual rate of 2.2% in August, with higher airfares offset by lower fuel costs and restaurant and hotel bills.
Central banks around the world dramatically increased borrowing costs from near zero during the coronavirus pandemic when prices started to shoot up, first as a result of supply chain issues built up and then because of Russia’s full-scale invasion of Ukraine which pushed up energy costs. As inflation rates have fallen from multi-decade highs recently, they started cutting interest rates.
The latest reading from the Office of National Statistics on Wednesday was in line with market predictions and means that inflation remains just above the British central bank's goal of 2% for the second month running, having fallen in June to the target for the first time in nearly three years.
Last month, the central bank reduced its main interest rate by a quarter-point to 5%, the first cut since the onset of the pandemic. It was a close call though with four of the nine members voting for no change.
