The Bank of England has warned of a record-length recession in Britain. As the central bank announced on Thursday, the country could fall into a phase of eight consecutive quarters with a decline in economic output. That would be the longest recession since reliable records began around 100 years ago, the PA news agency reported.
In terms of severity, however, the decline in economic output would be less drastic than in the past. Accordingly, a decline of 2.9 percent in gross domestic product is expected. During the financial and economic crisis of 2008, British economic output fell by 6.4 percent.
The British central bank raises interest rates to 3 percent
The central bank raised the key interest rate from 2.25 percent to 3 percent on Thursday – the biggest jump since 1989. It wants to bring the inflation rate under control, which the central bank estimates will peak at around 11 percent by the end of the year becomes.
Analysts had largely expected the step. Most recently, it had only raised the key interest rate by 0.5 percentage points. It is now the eighth interest rate hike since December 2021.
The decision to raise interest rates was not unanimous. Seven members of the nine-member Monetary Policy Committee MPC voted in favor of this rate hike, one member voted for a rate hike of 0.25 percentage points and one representative for 0.50 percentage points.
