PM and chancellor on holiday as Bank of England warns UK to be hit by recession

Credit: Sky News- Published on August 4, 2022
Both Boris Johnson and his chancellor Nadhim Zahawi are away on holiday as the Bank of England hiked interest rates for 27 years and warned of the longest recession since the financial crisis.

Video credit: Wibbitz Top Stories
Published on August 4, 2022 -  01:31
Bank of England Makes Biggest Interest Rate Hike in 27 Years
Bank of England Makes , Biggest Interest Rate Hike in 27 Years. On August 4, the Bank of England raised interest rates by half a percentage point. 'The New York Times' reports that it was the largest increase since 1995. The move comes as policymakers attempt to combat inflation while also warning Britain that a long recession is forecast for later this year. The bank predicted that the annual rate of inflation would rise above 13% when household energy costs climb higher in October. If that increase comes to pass, it would be the highest level of inflation in over forty years. The bank attributes much of the surge in prices to the global energy market. The price of wholesale natural gas has nearly doubled in the past three months. . Meanwhile, incomes adjusted for inflation and taxes are predicted to drop sharply in 2022 and 2023. It would mark the worst decline since the 1960s. In June, consumer prices rose 9.4%, faster than inflation in the United States and the European Union. According to the bank, these factors are forecast to combine and bring about a recession in the last quarter of 2022 that will last through the end of 2023

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Boris Johnson

Prime Minister of the United Kingdom from 2019 to 2022
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Central bank of the United Kingdom
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