British Central Bank Still Thinks About Measures Against Weak Pound

The British central bank is still considering whether to intervene because of the historically low value of the British pound.

According to Bloomberg news agency sources, the Bank of England (BoE) closely monitors developments. Economists are thinking of an early rate hike to help the currency and government bonds.

The British pound fell to a record low of 1.035 US dollars on Monday morning. The reason is fears of a deep recession in the United Kingdom after the new British Chancellor of the Exchequer, Kwasi Kwarteng, presented a controversial package of tax cuts on Friday.

The financial markets anticipate a 2 percentage point rate hike in November, which would almost double the interest rate to 4.25 percent. Last week, the BoE raised half a percentage point to combat high inflation.

Central banks of other countries are also busy raising interest rates against the rapidly rising prices.