Bank of England lifts rate for first time since 2023 to fight inflation
Dawn • • 1 min read
The Bank of England raised its benchmark rate by 0.25 percentage points to 4 per cent on Thursday, its first increase since August 2023. Dawn reported that the move responds to inflationary pressure from sharply higher energy costs, amid disruption to Gulf supplies and attacks on Russian refineries.
Governor Andrew Bailey said the increase does not signal a guaranteed series of further hikes, though he indicated another rise could follow if the Middle East conflict continues. The bank also lifted its UK growth forecasts to 1.6 per cent for 2026 and 1.3 per cent for 2027, while projecting inflation to reach 4.9 per cent in the second quarter of next year.
At a glance
- The Bank of England raised its benchmark rate to 4 per cent.
- The bank forecasts UK growth of 1.6 per cent in 2026 and 1.3 per cent in 2027.
- UK inflation is forecast to peak at 4.9 per cent in next year’s second quarter.
Originally reported by Dawn
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