BOE Hikes Key Rate by 25 Basis Points to 5.25%

BOE Hikes Key Rate by 25 Basis Points to 5.25%

Assessment

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Business

University

Hard

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The Bank of England's decision to hike interest rates by 25 basis points was largely expected by markets and economists, despite some speculation of a 50 basis point increase. The decision led to a slight weakening of sterling. Criticism arose regarding the Bank's reactive approach, focusing on past data rather than future projections. The decision also saw a three-way voting split, with some members favoring a larger hike.

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5 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What was the consensus view on the Bank of England's interest rate decision?

An increase from 5% to 5.25%

A decrease from 5% to 4.75%

An increase from 5% to 5.50%

No change in the interest rate

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What factor led to the expectation of a 25 basis point hike?

A strong economic growth forecast

A cooler than expected June inflation report

A decrease in unemployment rates

A higher than expected inflation report

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What criticism is directed at the Bank of England's decision-making process?

They are not considering inflation rates

They are ignoring market expectations

They are too focused on future projections

They are reacting to past events rather than future outlooks

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What was notable about the vote on the interest rate decision?

There was a three-way vote split

There was a two-way vote split

The decision was postponed

It was a unanimous decision

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which members were in favor of a larger interest rate hike?

Haskell and Man

Greenberg and Economics

Cable and Sterling

Burden and Lizzie