The Bank of England’s Monetary Policy Committee (MPC) is poised to increase interest rates at its next meeting, according to widespread expectations among economists and financial analysts.

The consensus forecast points towards a 0.25% increase, which would bring the base rate to 4.00%. Several factors are contributing to this expectation, including:

• Rising inflationary pressures: Recent data indicates that inflation remains above the government’s target of 2%.
• A robust housing market: House prices continue to climb, fueling concerns about a potential bubble.
• Strong economic growth: The UK economy has demonstrated resilience, prompting the need for measures to prevent overheating.

The MPC’s primary objective is to maintain price stability. By raising interest rates, the central bank aims to curb consumer spending and investment, thereby moderating inflationary pressures. A higher interest rate also makes borrowing more expensive, which can help to cool down the housing market.

However, some analysts caution that raising interest rates too aggressively could stifle economic growth. The MPC will need to carefully weigh the risks of inflation against the potential for a slowdown before making its final decision.

The official announcement from the Bank of England is expected later this week.