Many economists are saying they are expecting the Bank of England to raise interest rates by 0.25 percentage points to 5.25% on Thursday.
The fight to contain the cost of living is failing and even though inflation is declining many are expecting the Bank’s Monetary Policy Committee (MPC) to raise the base rate.
In June the K Consumer Prices Index (CPI) inflation was 7.9% compared to 8.7% in May, according to the Office for National Statistics (ONS).
With many industry sectors demanding higher pay the Bank of England is facing more pressure as a result and the MPC will most likely raise rates and economists are warning this cannot be ruled out.
Myron Jobson, senior personal finance analyst for Interactive Investor, said, “There might be a bit more urgency among banks and building societies to pass on the base rate rise to their savings products this time around as the Financial Conduct Authority (FCA) has recently gained new powers to take robust actions against those offering unjustifiably low rates.”