The Bank of England has warned the UK could fall into its longest recession since the financial crisis and predicts inflations will peak at more than 13 per cent.
It comes after the Bank's base interest rate soared from 1.25 per cent to 1.75 per cent - the biggest rise since 1995 - in a bid to curb the runaway inflation. Furthermore, Consumer Prices Index inflation may hit 13.3 per cent in October - its highest peak in more than 42 years - if Ofgem raises the price cap on energy bills to around £3.450, according to Bank of England forecasters.
Talking about Britain's current economic situation, the Bank said on Thursday: "Growth is very weak by historical standards." It is believed that household incomes will drop for two years in a row by 1.5 per cent this year and 2.25 per cent - the first time such a thing has happened since records began in the 1960s.
