The Bank of England is expected to raise interest rates back to its pre-pandemic levels today as it tries to dampen the UK’s inflationary surge.
The City widely anticipates the BoE will hike borrowing costs for the third meeting in a row, up to 0.75% at noon today, the highest since March 2020, despite the economic uncertainty created by Russia’s invasion of Ukraine.
UK interest rates Photograph: Bank of England
With inflation hitting 5.5% in January, and likely to rise over 7% in April, the UK central bank is keen to inflation expectations in check by tightening policy.
It is fretting that a wage-price spiral could develop as squeezed families seek help in the face of the worst cost-of-living squeeze in decades — there was understandable anger last month when BoE…