London | Britain will spend all next year in a stagflationary recession, the Bank of England has warned, even as it pushed through its steepest interest-rate increase in 27 years.
The bank raised its benchmark rate by half a percentage point to 1.75 per cent – the biggest such increase since 1995, following five quarter-point increases – as it tries to put a lid on Britain’s runaway inflation.
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Hans van Leeuwen covers British and European politics, economics and business from London. He has worked as a reporter, editor and policy adviser in Sydney, Canberra, Hanoi and London. Connect with Hans on Twitter. Email Hans at hans.vanleeuwen@afr.com
