2023-06-22 14:24:34
Updated Thursday, June 22, 2023 – 14:24
The Bank of England raises the price of money to 5%, with a rise of 0.50%
The governor of the Bank of England, Andrew BaileyAFPHousing Mortgages deepen their fall to 18.3% and shoot up the average interest rate by 1.3%
The Bank of England (BoE) increased the base interest rate by half a percentage point until it fixed, this Thursday the 22nd, the new rate in the 5%, the highest in fifteen years. The decision of the Monetary Committee of the issuing entity responds to the failure to contain inflation and impact the mortgage premiums of millions of homeowners, which have become progressively more expensive since December 2021.
The increase of 0,50% in the price of money United Kingdom doubles the proportion estimated by most analysts, who projected the adoption of a rate of 4,75% in the meeting held this Thursday the 22nd. The committee made the decision by majority, although two of the nine members voted against a rise to any level.
He BoE It functions independently of the Government, but it has to adjust monetary policy to the inflation target set by the Treasury Ministryhe 2% currently. Official data published the day before situate the general rate of the CPI in the 8,7%, unchanged from the previous month. The new indicators go against the projections of analysts, who anticipated a decline in the 0,3%.
In addition, core inflation – discounting food and energy – remains at 7,1%, the highest level since 1992. Conservative MPs are increasingly lobbying the governor of the central institution, Andrew Baileywhich they accuse of “calculation errors” in monetary management.
Bailey had forecast a sharp drop in inflation this year, in line with the moderation in energy prices after the peaks reached at the start of the aggression of Russia against Ukraine. But last month’s data points to factors internal to the British economy, including developments in the hospital and leisure sectors, among the causes of the persistently high cost of living.
Banks and savings banks anticipated the latest rate rise and immediately modified their mortgage offers. We give to two to- the most popular formula in United Kingdom along with the five-year fixed premium – are offered today at an average interest rate of 6,15. The same financial package was achieved by 5,98% before the weekend, according to data from the Moneyfacts platform cited by the Financial Times.
Analysts project further rate hikes to a peak of 6% by the end of 2024. “The time bomb has already exploded,” Martin Lewis, founder of MoneySavingExpert.com, who predicted weeks ago the latest twist in the cost of living crisis, told ITV television. It is estimated that mortgages will become more expensive by an average of 325 euros per month, which is equivalent to 8.3% of the income available for the population groups that continue to pay for the purchase of their home.
According to the criteria of The Trust Project
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