info@marketresearchfuture.com   📞  +1 (855) 661-4441(US)   📞  +44 1720 412 167(UK)

UK Recession Is Likely, Warns The Bank Of England

By Indu Tyagi Ketan , 08 November, 2022

On Thursday, the Bank of England (BoE) announced the most significant hike in the interest rate and warned about the impending recession the country will face within the upcoming two years. With rising food and energy prices, the most recent rate increase reflects aggressive rate tightening by central banks worldwide.

“It is a tough road ahead”, BoE governor Andrew Bailey remarked during a press briefing. He continued, “it was lifting borrowing costs by 0.75 percentage points to three percent -- the highest level since the 2008 global financial crisis -- to cool UK inflation that it sees shortly peaking at a four-decade high near 11 percent”.

As a result of central bank rate hikes, retail lenders are raising interest rates on their loans, which is expected to deepen the cost-of-living problem millions of Britons are already experiencing.

Mortgage payments in the UK have increased recently due to the BoE’s emergency purchase of UK government bonds and the former British prime minister Liz Truss’ debt-fueled budget, which wasn’t received well by the markets and led to her resignation.

Prime Minister Rishi Sunak, her successor, has tried to cool the investors by suggesting tax increases in a new budget to be released on November 17, even though doing so would further hurt the British economy.

Early in 2020, when the Covid-19 outbreak started, the BoE cut its benchmark interest rate to a record-low 0.1 percent while simultaneously injecting enormous amounts of fresh money into the economy.

The Bank of England began raising interest rates in December 2021, and the increase on Thursday was the eighth consecutive one. The annual inflation rate in Britain is now 10.1%, the highest level in 40 years.

Due to this interest rate inflation, food, electricity, and other goods and services will all cost more. As a result, businesses will generate less money, wages will decrease, and the unemployment rate is expected to rise to 6.4% in the next five years.

UK Recession 2023

Latest News

UK Recession 2023
China Emerges To Be The Leading Country In Industrial Robotics Sector

The robotics industry is growing day by day due to innovations in the technological field in 2024. The industrial market is increasing due to advancements in the artificial intelligence sector. The technological field is growing with robot production…

Read More

UK Recession 2023
Hydropower Dominates The Clean Electricity Production In Top Five Countries With Cleanest Grids In 2024

The clean energy transition is progressing with a greater speed in 2024. It is creating broader impacts in the different sectors of the economy. Hence, nations worldwide are supporting green transformation in several ways. However, funds for the…

Read More

UK Recession 2023
Geothermal Energy Expects Growth in the Race to Achieve Clean Energy

The clean energy attainment in the environment is actively incorporating conventional renewable energy sources into the sustainable mechanism of 2023. With the growing need for an energy transition, countries aim to replace fossil fuels with…

Read More

UK Recession 2023
Body Heat As A New Sources Of Renewable Energy

Renewable energy sources will multiply in the energy sector in 2024. The innovations regarding new sources of renewables are a compelling market strategy. It is because of the enhancement of green energy transformation with different substitutes to…

Read More

UK Recession 2023
Iceland World Leader In Renewable Energy Production

Renewable energy production is growing worldwide due to the clean energy transition in 2024. Renewable production is a vital point for transformation. However, the low availability of renewables is resulting in the slow progress of the clean energy…

Read More

Author Pic
Indu Tyagi Ketan

Chief Strategy Officer