News Release
Bank of England Raises Interest Rates by 0.25% to 6.50%
06 June 1997
The Bank of England has today raised its official dealing rate (the repo rate) by 0.25% to 6.50%.
The Bank's Monetary Policy Committee has reviewed the latest monetary and economic data. It concluded that the latest evidence is consistent with the outlook described in the Bank's Inflation Report published on 13 May. Notwithstanding the strength of the exchange rate, which is expected to restrain retail price inflation temporarily in the near term, the Report concluded that "the central projection for inflation, and the risks surrounding it, suggests that, on the present evidence, there is still likely to be a need for some further moderate tightening of policy in the months ahead."
The Committee accordingly voted to raise the Bank's repo rate by 0.25% to 6.50%. It believes that this action to tighten the monetary stance, taken with the aim of meeting the government's inflation target, offers the best chance of achieving continued growth in output and employment at a sustainable pace.
The increase takes immediate effect.
Minutes of the Monetary Policy Committee meeting will be published on Wednesday 16 July.
