London, Europe Brief News – The Bank of England has postponed a key decision on interest rates following the death of Queen Elizabeth II.
It said that “in light of the period of national mourning”, the Monetary Policy Committee’s decision would now be announced at midday on 22 September.
It follows moves by several public bodies to change their plans for the coming week after the death of Britain’s longest-reigning monarch.
The Bank had widely been expected to increase rates on Thursday.
Economists had been predicting that the UK’s central bank would raise rates to 2.25% – the highest level since December 2008.
Last month, the Bank raised interest rates by the highest margin in 27 years in an attempt to keep soaring prices under control. It also predicted that the UK economy would fall into recession later this year.
Higher interest rates can make borrowing more expensive, meaning people have less money to spend and prices will stop rising as quickly. However, some have question how effective UK rate rises can be when inflation is caused by global issues.
Energy prices climbed sharply when lockdown was lifted and the economy started to return to normal. They have increased further as Russia sharply cut its gas supplies to Europe. It has pushed up the price of gas across the continent, including in the UK, having a huge knock-on effect on consumers.
