Interest rates expected to be held by Bank of England
Summary
The Bank of England is expected to keep interest rates steady at 3.75% amid concerns about inflation and global events, including conflict in the Middle East. A recent peace deal between the US and Iran has helped ease energy price fears, but UK inflation may still rise due to upcoming increases in energy bills.Key Facts
- The Bank of England’s main interest rate is likely to stay at 3.75% for the fourth meeting in a row.
- Interest rates help control inflation, which means how fast prices increase.
- UK inflation was 2.8% in the year up to May, lower than some experts expected.
- Food price increases have slowed down, but transport costs rose the fastest.
- President Donald Trump announced a peace deal with Iran, which may lead to more stable oil supplies.
- Oil prices have dropped because the Strait of Hormuz, a key shipping route, is expected to reopen.
- UK energy bills will rise in July due to a price cap increase by 13%, which could push inflation higher.
- Mortgage rates in the UK have risen since March, with two- and five-year fixed deals now around 5.6%.
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