UK interest rates raised to 5.25% as Bank of England fights inflation – business live

There were protests outside the BoE as it announces that interest rates will rise again, although inflation is expected to drop to 5% by end of the year

Full story: Bank of England raises UK interest rate to fresh 15-year high of 5.25%TUC urges Bank of England to halt ‘reckless’ interest rate increases

The City of London is in a nervous mood ahead of the Bank of England’s interest rate decision at noon.

The FTSE 100 index of blue-chip shares has fallen by 101 points, or 1.3%, in early trading to a two-week low of 7,460 points.

The US is losing its long held safe credit mantle. This is long overdue. Credit agencies are notorious for being slow to act. More may follow. It is simply irresponsible to suggest the USA is a triple A credit.

At AA+, this is still a very generous appraisal for a government which is keenly allowing debt to balloon at an alarming pace. Debt to GDP is likely already well over 130%, but we just haven’t got the data yet. This is a catastrophe. Especially, when the nation involved is continuing to borrow and spend like there is no tomorrow.

The huge leap in government spending on the advent and excuse of Covid, has not been wound back. Instead, debt spending is continuing to grow.

There is no end in sight to the deterioration in the US fiscal position. Now with interest rates alarmingly higher, things are only going to get worse. And quickly.