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The latest verdict on interest rates is due to be reached by the Monetary Policy Committee (MPC) and announced at midday. Economists expect the base rate to rise by 0.5 percentage points, which would take the rate to four percent.
This would be the highest interest rate level since the Lehman Brothers filed for bankruptcy in 2008, launching the start of the economic crisis and credit crunch.
At the start of this year, the central bank appeared to gesture towards an interest rate rise.
Chief economist Huw Pill said the country is probably in a recession and inflationary pressures could remain going forward.
In a speech in New York, Mr Pill said the Monetary Policy Committee (MPC), of which he is a member, would act “forcefully” if the outlook were to suggest more persistent inflation.
The MPC has voted to increase the rate at each of its previous nine meetings.
When it comes to further rate increases, most economists polled by Reuters suggested Britons should brace for one more increase.
They expect the base rate to rise to 4.25 percent in March, which may be the peak of interest rate rises for the time being.
Andrew Hagger, personal finance expert at Moneycomms, appeared to agree, and said about today’s potential rise: “This 10th successive rate hike is unlikely to be the last in 2023.”
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Commenting ahead of the base rate decision, David Robinson, co-founder at Wildcat Law, said: “For Threadneedle Street, it’s a case of ‘damned if you do, damned if you don’t.
“Interest rate rises are needed to bolster Sterling versus the Dollar. This is critical to bringing down imported inflation, which is hitting everyone’s wallet at the moment.
“However, an interest rate rise at a time when we have one of the weakest economies in the developed world is a hefty gamble that will result in many individuals and businesses being forced into insolvency.
“The flip side is that it may be the lesser of two evils, as if they don’t raise rates then Sterling will slide against the Dollar again.”
An interest rate rise could be good news for pensioners, as it could spark a further increase to annuity rates, which have already been on the up.
If rate hikes are passed down to savers, they could also get more for the money they decide to put away.
The Bank of England continues to tread a fine line when it comes to the struggling UK economy.
While the rate of inflation eased to 10.5 percent, it remains high, particularly against the central bank’s target of two percent.
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However, similarly, the bank is keen to avoid recession, which could come about by raising borrowing costs.
Although inflation is falling as a result of softening energy prices, concerns remain about wage growth and how this could keep inflation high.
Andy Haldane, former chief economist at the central bank told BBC Radio 4’s Today programme: “I’d have preferred the Bank and other central banks to have started their rate rises a bit sooner, as that would have helped a bit in nipping inflation in the bud.
“It would have meant that we wouldn’t have had those rapid rate rises at the same time as the economy was hitting the buffers.”
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