The Bank of England (BOE), the central bank of the United Kingdom, is expected to decide to raise the benchmark interest rate for the fifth consecutive time this week, Bloomberg reported on the 12th (local time).
Bloomberg said the BOE is expected to raise its key interest rate by 0.25 percentage points from the current 1% to 1.25 percent at the Monetary Policy Committee (MPC) to be held on the 16th.
If BOE raises interest rates this time, it will be the fifth consecutive rate hike, and the UK benchmark interest rate will exceed the 1% mark for the first time since January 2009.
The BOE began raising interest rates last December to curb prices.
After the COVID-19 incident, it lowered it to an all-time low of 0.1%, but at first, it raised 0.15% points and then raised 0.25% points three times.
It was the first time since BOE became independent in 1997 that the benchmark interest rate was raised four times in a row.
The UK Consumer Price Index (CPI) jumped 9% in April from the same period last year, the highest level in 40 years.
This is the highest rate of increase since 1982, the highest among the G7s, including Germany (+7.4%) and France (+4.8%).
Earlier last month, BOE predicted inflation to exceed 10% at the end of the year.
Bloomberg said there is no disagreement that BOE, which focuses on price control, will raise interest rates at the meeting.
However, Bloomberg added that while some predict a “big step” to raise 0.5 percentage points, which is twice the usual increase, most expect a 0.25 percent increase.
According to a survey conducted by polling agency Ipsos early last month at the request of BOE, 70% of the respondents predicted that interest rates would rise over the next 12 months.
