[Politics] What is the Bank of England and why does it change interest rates?

[[Depo] @ Cselites.com]

The Bank of England has put up its main interest rate from 4.25% to 4.5% as it continues to try to control rising prices.

This is the 12th consecutive increase since November 2021.What is the Bank of England?The Bank of England is the UK's central bank. It is independent from the government.It describes its key job as ensuring the UK has secure banknotes, stable prices, a safe banking sector and a resilient financial system.Why does the Bank of England change interest rates?The bank has a target to keep inflation - the official measure of how quickly prices are rising - at 2%. However, despite falling back from a high of 11.1% in October 2022, inflation is still more than five times the 2% target.The Bank's traditional response to rising inflation is to increase the UK's official interest rate.This influences the saving and borrowing rates charged by high street banks to individuals and businesses.

In May, the Bank raised interest rates for the 12th time in a row, increasing them to 4.5%, their highest for almost 15 years.

 

Link: https://www.bbc.com/news/business-50837114