Thursday, May 10, 2007

Interest rates rise to 5.5%

The Monetary Policy Committee of the Bank of England has put up interest rates again to 5.5%, which I have to say is no surprise given that inflation reached 3.1% on the CPI measure and 4.8% (a 16 year high) on the RPI, which led to Mervin King, the Governor of the Bank writing a letter to Gordon Brown explaining why inflation was so far about target.

We should also remember that the last quarters repossession figures were the highest since 2000, at 17,000 per year. This interest rate rise is not going to help.

Still with a bit of luck it will halt the rise of inflation. We will see.

The BBC has this.

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