LONDON — The Bank of England announced its biggest interest rate increase in 27 years on Thursday as it forecast that the war in Ukraine would fuel further inflation and tip the U.K. economy into a prolonged recession.
Soaring natural gas prices are likely to drive consumer price inflation to 13.3% in October, from 9.4% in June, the bank said. That will push Britain into recession later this year, with economic output declining each quarter from the fourth quarter of 2022 through the fourth quarter of 2023, bank forecasts show.
