U.K News
Bank of England Keeps Key Interest Rate at 5.25% Despite Inflation Falling
The Bank of England maintained its main interest rate at a 16-year high of 5.25% on Thursday, despite inflation falling to its target of 2%, with several policymakers warning that a premature decrease may spark another wave of price increases.
Seven of the nine members of the bank’s ruling Monetary Policy Committee voted against a rate drop for the second week in a row, while two supported one. Interest rates have been constant since August, following a series of rises.
The statement accompanying the vote made it plain that there was disagreement on the forecast for inflation, with some expressing concern about continued significant price increases in the services sector, the key driver of the British economy.
“It’s good news that inflation has returned to our 2% target,” said Bank of England Governor Andrew Bailey, who voted to maintain current policy. “We need to be sure that inflation will stay low and that’s why we’ve decided to hold rates at 5.25% for now.”
The decision will likely dismay the ruling Conservative Party ahead of the United Kingdom’s general election in two weeks. Prime Minister Rishi Sunak would have seen a cut as good economic news, especially if it came with a drop in mortgage rates.
Upcoming UK Election
The panel maintained that the upcoming election, which the main opposition Labour Party, led by Keir Starmer, is generally expected to win, did not influence its conclusion. It stated that the decision was, as always, based on meeting the 2% inflation objective “sustainably in the medium term.”
Economists anticipate a rate decrease is on the way, either at the bank’s next policy making meeting in August or the one following in September. They expect clear evidence by then that inflation will remain close to the target for the next year or two.
“We continue to believe that the MPC will ease restrictive policy beginning in the summer and deliver two rate cuts this year,” said Sanjay Raja, Deutsche Bank’s senior U.K. economist.
The reduction in the primary inflation measure to a near three-year low of 2% in the year to May does not imply that prices are falling; rather, they are rising at a slower rate than they have in recent years during a cost-of-living crisis that has resulted in reduced living standards for millions in Britain.
Central banks worldwide dramatically increased borrowing costs from the lows seen during the coronavirus pandemic, when prices began to rise, first due to supply chain issues accumulated during the pandemic and then due to Russia’s invasion of Ukraine, which pushed up energy costs.
Bank of England unduly cautious
Higher interest rates, which cool the economy by making borrowing more expensive, have helped to reduce inflation, but they have also weighed on the British economy, which has hardly expanded since the pandemic’s recovery.
Critics of the Bank of England argue that it is unduly cautious about inflation and that keeping interest rates too high for too long will put undue strain on the economy. It is an accusation that has also been leveled at the United States Federal Reserve, which has held interest rates constant in recent months.
“Given that the U.K. has moved onto a milder inflationary trajectory, rate setters remain overly cautious about the likelihood of loosening policy, risking impeding the U.K.‘s growth prospects,” said Suren Thiru, economics director at The Institute of Chartered Accountants in England and Wales.
Some central banks, like the European Central Bank, have begun to decrease interest rates as inflationary pressures have subsided. On Thursday, the Swiss National Bank cut its main interest rate by a quarter of a percentage point to 1.25%.
Source: The Associated Press
U.K News
Former Top Northern Irish Politician Jeffrey Donaldson To Stand Trial Over Alleged Sex Offenses
Jeffrey Donaldson, the former head of Northern Ireland’s most famous pro-union party, will face trial on charges of previous sex offenses, including one of rape.
Donaldson went before a preliminary inquiry on Wednesday, which agreed to proceed with a trial set for September 10, according to a statement issued to CNN by the Northern Ireland Courts and Tribunals Service (NICTS).
Donaldson | CNN image
Former Top Northern Irish Politician Jeffrey Donaldson To Stand Trial Over Alleged Sex Offenses
The lawmaker has since been charged with an additional seven counts. The 18 alleged acts include one allegation of rape, 13 charges of indecent assault on a female youngster, and four counts of gross indecency toward a kid.
Donaldson was asked in court whether he wanted to speak about the charges, according to PA Media. “Not at this stage,” he said, according to the news agency.
Eleanor Donaldson, his wife, is also scheduled to stand trial in September. She has been charged with one count of helping and abetting rape, three counts of aiding and abetting assault on a female child, and one count of cruelty to a person under 16.
Donaldson led the DUP from 2019 through much of the contentious Brexit process, frequently expressing his opposition to the Northern Ireland Protocol, a vital component of the Brexit withdrawal agreement that ensured there would be no hard border between Northern Ireland and the Republic of Ireland.
Donaldson and his wife have already denied all claims, according to Irish national network RTÉ on Wednesday.
Jeffery Donaldson | CNN Image
Former Top Northern Irish Politician Jeffrey Donaldson To Stand Trial Over Alleged Sex Offenses
Donaldson’s trial was announced as Northern Ireland residents prepared to vote in the UK general election. Northern Ireland, one of the UK’s four devolved nations, has 18 members in the Westminster parliament. Northern Irish politicians can run for a seat in Westminster or the devolved legislature, the Northern Ireland Assembly. Sinn Féin, the leading nationalist party, does not take up their seats in Westminster if elected.
Donaldson was set to run again in the Lagan Valley constituency, but former DUP party colleague Jonathan Buckley has replaced him.
SOURCE – (CNN)
Prince Harry discussed sorrow and grief with the founder of a charity that helps children who have lost a parent while serving in the British military forces.
“You convince yourself that the person you’ve lost wants you, or you need to be sad for as long as possible to prove to them that they are missed,” said the Duke of Sussex, who lost his mother, Princess Diana, when he was 12 years old.
Prince Harry | CNN Image
Prince Harry Opens Up About Grief And Bereavement
“But then there’s this realization of, no, they must want me to be happy,” he told Nikki Scott, founder of Scotty’s Little Soldiers, in a charity video posted Thursday.
Diana died in a vehicle incident in Paris on August 31, 1997. She was 36 years old.
Harry emphasized the necessity of discussing feelings during the grieving process.
“That’s the hardest thing, especially for kids, I think, which is, ‘I don’t want to talk about it because it will make me sad, but once realizing that if I do talk about it, and I’m celebrating their life, then actually, things become easier,'” according to him.
Harry, a global ambassador for Scotty’s Little Soldiers, spoke with Scott ahead of Armed Forces Day on June 29.
Scott told the Duke about the moment she had to inform her son, Kai, that his father, Cpl. Lee Scott had been murdered in Afghanistan.
It was the worst. “How do you tell a 5-year-old this?” she asked, recalling the emotion of having “shattered his world” in July 2009.
Scotty’s Little Soldiers estimates that 2,100 children lose a parent who served in the UK military each year.
The nonprofit now serves over 680 members and hopes to serve over 1,000 persons annually by 2030.
Prince Harry | CNN Image
Prince Harry Opens Up About Grief And Bereavement
Harry complimented Scott for her “incredible” efforts in establishing the foundation.
“It’s incredibly inspirational. I’m incredibly honored and privileged to be a part of Scotty’s now, and I’m looking forward to doing everything we can to bring in more people, generate more interest, collect more cash, and get the message out there to get more kids the help they so urgently need,” he said in a news statement.
A video of their entire talk can be viewed on the charity’s website.
SOURCE – CNN
LONDON — U.K. Prime Minister Rishi Sunak disputed claims on Sunday that his party will lose the July 4 general election, using one of his final TV interviews to defend the Conservatives’ economic record.
Rishi told the BBC that he expected to remain in power by the end of the week, despite opinion surveys showing the Conservatives behind the opposition Labour Party under Keir Starmer.
Rishi Sunak | AP news Image
In The Final Days Before The UK Election, Rishi Sunak Insists That He Can Stay In Power
“I’m fighting very hard,” Sunak remarked. “And I think people are waking up to the real danger of what a Labour government means.”
While he admitted that the prior few years “had been difficult for everyone,” Rishi said it was “completely and utterly wrong” to say that Britain’s global position has weakened since Brexit.
Rishi Sunak | AP News Image
In The Final Days Before The UK Election, Rishi Sunak Insists That He Can Stay In Power
“This declinist narrative about the United Kingdom is completely false. “I wholeheartedly reject,” he stated. “The United Kingdom is a better place to live than in 2010.”
After 14 years of Conservative-led governments, many voters blame the party for Britain’s cost-of-living issue, long healthcare waiting lists, high levels of immigration, and the disruptions brought about by the country’s exit from the European Union.
Rishi Sunak | AP News Image
In The Final Days Before The UK Election, Rishi Sunak Insists That He Can Stay In Power
Rishi, who took office in October 2022, has attempted to silence his critics by claiming that his initiatives have begun to address such issues and threatening that Labour leader Keir Starmer would hike taxes if his party won the election.
SOURCE – (AP)
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