Financial institution of England hikes rates of interest for fifth time

Bank of England hikes interest rates for fifth time
The Bank of England said on Thursday that it would raise the cost of borrowing by 25 basis points to 1.25% despite fears that soaring prices are already squeezing households and weighing on economic growth.

“Bank staff now expect GDP to fall by 0.3% in the second quarter as a whole, weaker than anticipated at the time of the May Report,” the Bank of England said in a statement.

“Consumer confidence has fallen further, but other indicators of household spending appear to have held up. Some indicators of business sentiment have weakened, although they have so far remained more resilient than indicators of consumer confidence and consistent with positive underlying GDP growth,” it added.

The central bank said three members of its Monetary Policy Committee wanted to raise rates by 50 basis points to 1.5% — which would have been the biggest increase in 27 years — but were outvoted by the other six.

Soaring food and fuel prices have plunged millions of Britons into the worst…