Aug 11

Bank of England raises UK interest rates to 5.25%

The UK’s interest rate has been raised to 5.25% by the Bank of England, as it continues to try and bring inflation under control.

The Bank’s Monetary Policy Committee increased the rate by 0.25% from 5% – the 14th increase in a row.

It is a 15-year high for the base rate, which was last at this level in April 2008.

Vicky Pryce, Economic Advisory Council member at the British Chambers of Commerce (BCC), said:

‘Businesses across the UK will be fervently hoping that today’s rise in interest rates is the last they will see.

‘While many firms will have already factored this increase into their plans, it is clear from the recent rise in insolvencies that the economic environment is becoming stacked against smaller firms. They are the ones with less cash reserves in the bank and greater exposure to finance.

‘And there is now a real danger that the economy could be pushed into recession as it takes 18 months for changes in interest rate rises to filter through. With all the cumulative pressure of past rises yet to come, business will be watching closely for any further indications on the Bank’s plans.’

Internet link: Bank of England website BCC website

Open Quote

From first going self-employed to starting a limited company, the fantastic accountants at Sage have talked me through the processes and looked after all things accounts-related, leaving me with peace of mind; free to focus on the day-to-day operating of the business. Sage handles everything for me from payroll to tax returns and their service is flawless; when I need something its done; when I need info I get it. All of their staff are friendly, professional, efficient and patient and I couldn’t manage without them.

 

Close Quote