BoE increased interest rates by 50-bps year-end meeting.

The Bank of England (BoE) rose interest rates by 50 bps to %3.50 in the last meeting of 2022. BoE gave the message that if the inflation remains high level, they will continue rising the rates. They also said that inflation has reached its peak, but it will maintain its high level in the coming months. The annual inflation was announced lower than expectation %10.70 level in this week. Even, BoE exhibit hawkish stance, FED’s decisions weigh on pound value.

 

UK Retail Sales dropped more than expectation by 0.4% in November compared anticipated growth of 0.3%. Moreover automotive fuel sales volumes fell %1.7 in November. These data increased concerns of recession. However, the BoE now seems determined to reduce inflation to the target level of %2.