The Bank of England raises its benchmark interest rate and issues a warning that a recession is on the horizon.
As a result of the historically high increase in interest rates in the UK, a warning has been issued.
The Bank of England has decided to raise the benchmark interest rate, while at the same time, it has issued a warning about the impending deterioration of the economy.
The Bank of England announced on Thursday that it will impose the most significant increase in interest rates since 1995 in an effort to combat the surging inflation that has been plaguing the country.
In what was the sixth increase in interest rates since December, the regulatory body hiked its benchmark rate by a half of a percentage point, bringing it to 1.75 percent. This brought the total number of rate increases since December to six.
The bank for the United Kingdom (UK) also forecasted a recession, with the warning that the economy will begin contracting beginning in the fourth quarter of this year and will continue to do so throughout the following year. This was accompanied by the prediction that the contraction will continue throughout the following year.
Inflation in the United Kingdom skyrocketed to 9.4 percent in June, and some projections suggest that it may continue to grow until it reaches between 11 percent and 15 percent by the beginning of next year. This is based on the fact that inflation in the United Kingdom reached 9.4 percent in June.
The majority of the increasing pressure on pricing is coming from the growing prices of both energy and food. This is because both of these categories of goods are in high demand.