LiveMore comments on Bank of England base rate rise

Simon Webb, managing director of capital markets and finance at LiveMore, said: “The 0.25% increase in the Bank of England base rate to 4.5% was not unexpected and the money markets have priced this in. The last time the rate was this high was in October 2008 when governments were bailing out banks due to the global financial crisis.”

“This rise is the 12th consecutive increase reflecting the persistence of high inflation. Although food costs remain high, the fall in wholesale gas prices and petrol could ease inflation a little, and although we have not gone into recession the economy is still volatile.”

“The jury is out over whether there will be another hike upwards in base rate when the MPC meets next month. The MPC’s report today states an expectation of the base rate peaking at 4.75% in Q4 2023 before falling back down to 3.5%.”

Published: 11 May 2023