If you live in the United Kingdom and you want to know about the rules and policies of banks, you must know that the current UK interest rate is 0.75%. This is the present interest rate in the country in all banks. Since the interest rate has been constant for some time now, the banks have been able to control the inflation that helps in maintaining growth and employment. The financial condition of the UK has been facing uncertainty due to Brexit. The economic policies of banks will depend on withdrawal from the EU and when exactly will it happen.
The interest rate in the banks of the UK was very high a few centuries ago. The former Prime Minister Margaret Thatcher increased it to very high levels in 1979 up to seventeen percent. This reduced inflation during that time. The interest rate was 3.5% in July 2003 and it was raised to 5.75% in July 2007. In March 2009, the interest rate decreased very low to 0.5%. It was in August 2018 that the interest rate was fixed at 0.75%. This low level of the interest rate was beneficial to the new homebuyers.
The banks have been able to maintain the 0.75% interest rate in the current time. Bank of England has the authority to determine the rate of interest for all banks in the country. Its Monetary policy Committee decides the interest rate through a voting procedure. The committee has decided to increase the UK interest rate slowly in a limited way in the coming times in the future. The banks will do this even if the global economy is going down and there is an atmosphere of confusion over the Brexit. The UK GDP has increased by 0.5% in the first quarter of 2019. This is mainly due to the boosted industrial production and the rise of the value of stocks in Europe. Experts say that this boost is temporary and will last for a short time.