Bank of England raises interest rates only slightly – by 0.5 percent

To the surprise of the financial markets, the British central bank is raising the key interest rate rather moderately. It increased it by 0.50 percentage points to 2.25 percent on Thursday. An increase of 0.75 percentage points was expected on the financial markets after the US Federal Reserve unleashed a veritable fireworks display with three XXL increases in a row.

The currency watchdogs in London are reacting to the high inflation rate, which in the course of the energy crisis has shot up to 9.9 percent, well above the Bank of England’s (BoE) stability target of 2.0 percent, by tightening monetary policy.
Due to the mourning phase after the death of Queen Elizabeth II, the interest rate decision had been postponed by a week.

New Prime Minister Liz Truss recently unveiled a multi-billion dollar plan to deal with the energy crisis. The government expects that this will noticeably depress the inflation rate.

More: Fed raises key interest rate by 0.75 percentage points – “job market out of balance”