The Bank of England decided to vote to raise interest rates by 50 basis points in its meeting moments ago, to reach 2.25%, as expected.
The interest report issued by the bank stated that the members of the bank voted by a majority of 5 members to raise interest rates by 50 basis points, while three members voted to raise them by 75 basis points, and one member voted to raise interest rates by 25 basis points.
The committee also voted unanimously to reduce the stock of UK government bonds purchased by £80 billion over the next twelve months to £758 billion.
The interest statement issued by the Bank stated that there is a decline in uncertainty about the outlook for energy prices in the UK after the government measures and is expected to limit further increases in CPI inflation.
The inflation index represented in the annual consumer price index declined to 9.9% in August from 10.1 in July, as the peak of inflation is likely to be less than what was expected in the August report at less than 11% in October.
The British pound reacted strongly negatively after the meeting and is now trading around 1.1290 levels, as the rate of hike was expected in the markets, and the movement will now depend on the future outlook for the interest rate.
02/11/2024
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