Interest rates LATEST: Bank of England RAISE rates to highest level since 2009

Thursday, August 2, 2018
By Paul Martin

THE Bank of England has raised interest rates for the second time in almost a decade today, in a bid to return to a “normal” monetary policy following the 2008 market crash.

Thu, Aug 2, 2018

Savers are in for a good news as the nine members of the Monetary Policy Committee (MPC) unanimously took the decision to increase rates to their highest level since the financial crisis struck, from 0.5 percent to 0.75 percent.

This move signals a gradual return to rates recorded before the crisis.

In March 2009 the Bank slashed from the rate from one percent to the emergency low of 0.5 percent in an effort to contain the fall-out from the economic crisis.

In August 2016 the Bank of England further cut down interest rates to 0.25 percent.

The MPC, a committee in charge of setting the official rates in the UK, first increased them in November last year.

The Bank also kept its forecast for UK growth unchanged at 1.4 percent in 2018, but upped the outlook to 1.8 percent in 2019.

And more rate rises are on the table, according to the MPC itself.

They said in a statement: “The committee judged that, were the economy to continue to develop broadly in line with its inflation report projections, an ongoing tightening of monetary policy over the forecast period would be appropriate to return inflation sustainably to the 2 percent target at a conventional horizon.

“All members agreed that any future increases in bank rate were likely to be at a gradual pace and to a limited extent.”

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