Bank Of England Raises Interest Rates Yet Again, Expects Inflation To Fall

The Bank of England decided to hike interest rates by a further quarter of a percentage point on Thursday and said it expects the surge in British inflation to cool faster than before, despite a surprise jump in price growth declared on Wednesday, according to a Reuters report.

Sounding more upbeat about the outlook for the country's slow pace of economic growth, the BoE's nine rate-setters voted 7-2 in favour of a 25 basis-point increase in Bank Rate to 4.25%, added the Reuters report.

That was its 11th consecutive increase in borrowing costs which began in December 2021, although it was the smallest rise since June last year, quoted the Reuters report.

Monetary Policy Committee members Swati Dhingra and Silvana Tenreyro voted to keep rates on hold while Catherine Mann, who has been the committee's strongest advocate for raising rates in bigger steps, backed the relatively small 25 basis-point increase.

The BoE - which is trying to reconcile a weak economic outlook and anxieties about global banks with stubbornly high inflation - kept unchanged its message that its MPC saw less urgency about maintaining its fast run of rate hikes, stated the report.