Our monetary policy statement at a glance - October 2022
What did we decide?
We raised interest rates again, by 0.75 percentage points
We are doing this to bring down inflation, which remains far too high. More rate hikes will come. They will depend on how we see the economy and inflation developing.
We also adjusted some of our other instruments
To help fight inflation, we have made our targeted lending programme less attractive for banks.
What is going on in the economy?
Inflation is far too high, and will stay high for a while
Prices are rising across the economy. Very high energy prices are still the main reason for this. Supply problems are getting better but are still driving up prices. The exchange rate has also pushed up inflation, by making imports more expensive.
The economy will weaken in the coming months...
This weakness will probably last for the rest of this year and into the first part of 2023. High inflation, problems with gas supplies and worries about the future mean that people are buying less and businesses are cutting production.
… even though lots of people have jobs
Unemployment is still low and new jobs are being created. But as the economy weakens, this could change.
The world economy is also growing more slowly
The outlook is more uncertain, especially because of Russia’s war against Ukraine. Central banks across the globe are also raising interest rates to fight inflation.