Central Banks
BOE Raises Rates With UK Likely to Avoid Recession for Now
- Officials signal further rate rises if inflation persists
- Decision dashes hopes for a pivot away from tightening
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The Bank of England pushed ahead with another interest rate increase despite turmoil in the banking sector, predicting the UK economy will avoid a recession for now and that inflation remains a risk.
The central bank raised its benchmark lending rate as expected by a quarter point to 4.25%, the highest since 2008, and left the door open to further increases if inflation persists. Policy makers voted 7-2 for the hike, with none of the BOE’s officials joining the dissent.