AGL 38.30 Increased By ▲ 0.73 (1.94%)
AIRLINK 132.00 Decreased By ▼ -0.50 (-0.38%)
BOP 5.60 Decreased By ▼ -0.04 (-0.71%)
CNERGY 3.84 Increased By ▲ 0.07 (1.86%)
DCL 8.65 Decreased By ▼ -0.22 (-2.48%)
DFML 40.82 Decreased By ▼ -0.18 (-0.44%)
DGKC 88.70 Decreased By ▼ -1.46 (-1.62%)
FCCL 35.20 Increased By ▲ 0.12 (0.34%)
FFBL 66.41 Decreased By ▼ -0.09 (-0.14%)
FFL 10.48 Increased By ▲ 0.33 (3.25%)
HUBC 109.60 Increased By ▲ 3.20 (3.01%)
HUMNL 14.66 Increased By ▲ 1.26 (9.4%)
KEL 4.82 Decreased By ▼ -0.04 (-0.82%)
KOSM 7.08 Increased By ▲ 0.23 (3.36%)
MLCF 42.46 Increased By ▲ 0.66 (1.58%)
NBP 59.49 Increased By ▲ 0.91 (1.55%)
OGDC 184.21 Increased By ▲ 2.96 (1.63%)
PAEL 25.56 Decreased By ▼ -0.14 (-0.54%)
PIBTL 5.90 Increased By ▲ 0.07 (1.2%)
PPL 147.50 Decreased By ▼ -0.90 (-0.61%)
PRL 23.55 Increased By ▲ 0.33 (1.42%)
PTC 16.45 Increased By ▲ 1.21 (7.94%)
SEARL 69.18 Increased By ▲ 0.39 (0.57%)
TELE 7.23 Decreased By ▼ -0.01 (-0.14%)
TOMCL 35.80 Decreased By ▼ -0.20 (-0.56%)
TPLP 7.55 Increased By ▲ 0.15 (2.03%)
TREET 14.20 Decreased By ▼ -0.04 (-0.28%)
TRG 50.98 Increased By ▲ 0.13 (0.26%)
UNITY 26.83 Increased By ▲ 0.43 (1.63%)
WTL 1.23 Increased By ▲ 0.02 (1.65%)
BR100 9,813 Increased By 45.5 (0.47%)
BR30 29,780 Increased By 379.7 (1.29%)
KSE100 92,298 Increased By 360.4 (0.39%)
KSE30 28,798 Increased By 54.2 (0.19%)

LONDON: The Bank of England on Thursday hiked its interest rate by half a point to 3.5 percent, the highest level in 14 years, in a bid to cool sky-high inflation.

The increase was the BoE’s ninth in a row, while the amount matches a hike Wednesday by the US Federal Reserve. The European Central Bank announces its latest rate decision at 1315 GMT.

“The labour market remains tight and there has been evidence of inflationary pressures in domestic prices and wages that could indicate greater persistence and thus justifies a further forceful monetary policy response,” the BoE said in a statement following its latest rate call.

The hike was less than in November when it lifted borrowing costs by 0.75 percentage points.

The Fed also slowed the pace of its tightening on Wednesday, as inflation eases on both sides of the Atlantic.

The BoE on Thursday added it expects the UK economy to contract 0.1 percent in the fourth quarter, better than its previous forecast for a contraction of 0.3 percent.

The UK government has said the British economy is in a recession that it expects to carry on into next year on fallout from rocketing energy and fuel bills.

UK inflation slows, remains close to 11 percent

UK inflation stands at 10.7 percent, the highest level for around 40 years, with prices surging on supply constraints caused by Russia’s invasion of Ukraine, the lifting of pandemic lockdowns and Brexit fallout, according to economists.

Soaring prices are eroding the value of wages, causing public and private sector workers to go on strike in an attempt to secure higher salaries.

While boosting savers, rising interest rates are increasing loan costs for individuals and businesses.

“To make matters worse, higher mortgage payments will come on top of all the other soaring costs – from food to fuel,” noted Sarah Coles, senior personal finance analyst at stockbroker Hargreaves Lansdown.

Strikes over pay

UK nurses on Thursday staged an unprecedented one-day strike as a “last resort”, despite warnings it could put patients at risk.

It follows fresh walkouts by railway staff, while planned stoppages by passport control and postal workers spell Christmas misery for millions of Britons.

Bank of England to add 50 bps to Bank Rate on Dec. 15; peak at 4.25% in Q2

The UK consumer prices index eased in November from October’s annual inflation rate of 11.1 percent, official data showed on Wednesday.

The BoE meanwhile began to raise its rate in December last year, when it had stood at a record-low 0.1 percent.

Paul Dales, chief UK economist at Capital Economics, said on Thursday that he expected the BoE to keep on hiking up to a peak of 4.5 percent early next year, as inflation remains at historically-high levels.

Comments

Comments are closed.