Bank of England to make interest rate announcement this week - what we can expect

The Bank of England will make it's latest announcement regarding interest rates on Thursday. And according to experts the bank is expected to keep interest rates steady at 5.25% on Thursday, amidst fears of a recession.

It comes as several key indicators suggest that the UK economy is weakening. Economists have been increasingly discussing the possibility of a recession in the UK.

The Bank's Monetary Policy Committee (MPC) had previously downgraded its outlook for the third quarter of 2023 when they last met in September - predicting only a 0.1% rise in GDP, compared to the 0.4% increase forecasted just a month earlier.

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The MPC stated that their agents' intelligence "suggested that activity had remained subdued and that there were growing concerns about the economic outlook". Now, all eyes are on whether the economists at Threadneedle Street believe the UK could be heading towards a recession.

However, any such prediction would come with a caveat that the Bank has made errors in the past. The release of the MPC Report on Thursday will mark almost a year since the Bank predicted that the UK was on track for its longest recession since the 1930s.

As a result of this and other misses on the inflation front, the Bank in July appointed former US Federal Reserve chair Ben Bernanke to lead a review of its forecasts.

It is also almost exactly a year since the MPC hiked interest rates by 0.75 percentage points on November 3, 2022, the biggest single increase since 1989.

But a year on and the picture for rates is significantly