Interest rate rises to 3% as Bank of England imposes biggest hike for three decades – By Ed Conway (Sky News) / Nov 3, 2022
A gloomy update from the Bank of England provides no upwards pressure for the pound, which had slumped against a surging dollar earlier in the day and later fell further to $1.11.
The Bank of England has raised the base rate of interest by 0.75 percentage points to 3% – the single biggest increase in more than three decades – and said that the UK is already in recession.
The Bank warned that the UK could face a protracted contraction in the coming years, with high inflation and the unemployment rate climbing to 6.5% – the highest since the financial crisis.
The length of its forecasted recession – eight successive quarters in which gross domestic product shrinks – would make it the most protracted since comparable records began – albeit less deep than most previous downturns, including those in 2008/2009 and the 1980s.
The economy would still be well below its 2022 size at the end of 2025.
