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Interest rate rise increases the risk of recession, says TUC

Commenting to the decision by the Bank of England to raise interest rates by 0.25%, TUC head of economics Kate Bell said:

“Raising rates doesn’t help when the main inflation drivers are external, like global energy prices and pandemic interruptions to supply chains. And this rise increases the risk of a recession, which is a bigger danger for the economy and would be devastating for families and businesses.

“The government must play a much more active role supporting household incomes and wage growth to see families through the cost of living crisis. And we need a national plan to build UK resilience with independent energy supply and a revival of UK manufacturing so that we are less dependent on imports. Triggering a recession now will not help with that at all, it will only make things harder.”

 

Original article link: https://www.tuc.org.uk/news/interest-rate-rise-increases-risk-recession-says-tuc

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