BoE hikes interest rates in fresh blow to mortgage holders – live

Bank of England governor says truce mini-budget damaged Britain’s reputation

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To tackle rising inflation, the Bank of England has raised the base rate by 0.5 percent to 3.5 percent.

The latest increase represents a modest increase in the rate, after the bank’s MPC last month opted for a 0.75 percentage point hike – the highest single-day increase since 1989.

It was the ninth consecutive time that officials raised rates as they try to tackle inflation, which currently runs at 10.7 percent – down slightly from 11.1 in October but still at historically high levels.

Higher interest rates will bring fresh pain for mortgage holders on deals linked to the bank’s base rate, while those with soon-to-expire fixed rates will have to refinance at higher rates.


Our live coverage of the interest rate hike has been paused.

jane dalton15 December 2022 15:34


Government committed to reduce inflation: Minister

John Glenn, Chief Secretary to the Treasury, said: “We are united with the Bank of England in our determination to reduce the inflation rate from 10.7% to the target of 2%”.

He cited the “weaponisation” of energy prices by Vladimir Putin, which caused “enormous challenges” on inflation.

“We recognize that it is really difficult for people in an economy dealing with inflation,” he said.

jane dalton15 December 2022 15:12


Most say government doing badly on cost-of-living crisis – survey

According to YouGov, a majority of Britons describe the economy as being in poor shape, while eight in 10 (78%) say the government is doing a poor job of managing the cost of living. survey,

Seven in 10 (68%) expect the economy to get worse over the next 12 months.

The picture is even bleaker among conservative voters – a majority (58%) of this group expect the economy to worsen.

This shows that the prime minister and chancellor still have a lot of work to do in convincing the public that they have a grasp on the economy and the rising cost of living.

jane dalton15 December 2022 14:52


‘Nightmare before Christmas’, say Lib Dems

Liberal Democrats Treasury spokeswoman Sarah Olney said the interest rate hike was “a nightmare before Christmas for families already struggling with the cost of living”.

He said the government’s “complete and utter failure to control inflation and their disastrous mini-budget has pushed up mortgage payments at the worst time of year”.

He called for a temporary ban on home repossessions and a mortgage rescue fund to support the hardest hit.

“The government must also finally deliver on its long-standing promise on no-fault evictions to protect renters at risk of homelessness this winter.”

jane dalton15 December 2022 14:16


Higher rates ‘the last thing Britain needs’

Think tank The New Economics Foundation condemned the rate hike, saying it was the last thing Britain needed.

Higher rates “will do little to tackle the main causes of inflation (higher prices of imported food and gas), but they will put further pressure on our economy which is already entering recession”, it said.

jane dalton15 December 2022 14:10


The European Central Bank (ECB) has slowed its record pace of interest rate hikes, joining the Bank of England and other central banks in slightly more restrained measures to tackle inflation.

The ECB, Britain’s central bank and the Swiss National Bank followed the lead of the US Federal Reserve and dialed back on half-point growth today from three-quarters of growth.

Inflation in the 19 countries that use the euro eased from 10.6 percent in October to 10 percent in November, the first drop since June 2021.

But ECB officials have said it is too early to say whether momentum has peaked, with higher energy prices threatening a recession in Europe.

“The Governing Council decided today to raise interest rates, and they are expected to do so further, as inflation remains very high and is forecast to remain above target,” the ECB said of the bank’s 2 percent target.

Bank President Christine Lagarde is expected to stick to a strong anti-inflation message during a news conference following the decision.

ECB chief Lagarde at a press conference in June


liam james15 December 2022 13:56


TUC says rising interest rate could make situation worse

Unions said the Bank of England’s latest rate hike risks leaving people even further behind in the cost of living.

Kate Bell, head of economics at the TUC, said: “With the UK economy in recession, and the value of everyone’s wages falling, this rate hike could make a bad situation worse.

“The priority now should be to protect living standards and boost the economy to prevent recession and protect people’s jobs,” the union of economists said.

“The best way to do that is to give working people a fair wage increase that keeps up with the cost of living.”

Earlier, a spokesman for the United union said the bank was wrong in approving the rate hike, warning a further rise in borrowing costs “could be the straw that breaks the camel’s back”.

liam james15 December 2022 13:38


Pound drops against dollar after interest rate hike

The pound dipped in response to today’s interest rate announcement, falling as much as 1 percent against the dollar.

It bounced back slightly but remained 0.78 percent lower at 1.232 against the US dollar and 0.2 percent lower at 1.160 against the euro.

Market turmoil following Liz Truss’ mini-budget has seen the pound fall sharply this year, plunging almost into parity with the dollar.

It has been rising steadily since September, reaching a six-month peak of 1.24 on Tuesday.

Today’s pound vs dollar movements around 1pm


liam james15 December 2022 13:20


Bank of England raises interest rates to 3.5% despite low inflation

my colleague liam james Here are the full details of today’s bank announcement:

Bank of England raises interest rates to 3.5% despite low inflation

Borrowers face higher costs as bankers signal Britain is not yet out of crisis

matt mathers15 December 2022 13:05


Martin Lewis: Mortgage holders to see costs rise by £300 a year on tracker deals

Martin Lewis has said that people on tracker mortgage deals can expect to see their annual costs rise by around £300 a year for every £100,000 of mortgage.

The money savings expert said the current reforms would not change, while “the new fixed rates have already reduced much of this growth.”

matt mathers15 December 2022 12:46

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