Bank Rates Not to Increase in 2011?

The economy has suddenly stalled on the free-riders, and the UK has stopped being jubilant in quelling fears that there is no wall against a recuperating economy in the new era. But what has come as a reprieve for most businesses as well as the Government, the Bank of England poll has stated that there is a very low possibility of banks in the country raising their interest rates in the current year. This, according to most London accountants, is good news for the consumers!


This trend of hiking interest rates or repo rates as often they are called, can be a vicious blow on the economy, albeit for the fact that it helps control inflation but pulls the whole system down by default. A case in point is that of two other economic giants in contrasting parts of the world – the USA and India.

While the USA is fighting to secure a debt deal that will raise the debt ceiling and negate any default that may cause the already scarred economy to lose consciousness, the Indian economic progress is being projected as to be tied down by the 0.50% hike in repo rates by the RBI (Reserve Bank of India) – which is said to be almost double of the hike that traders and businesses expected in this rising inflation.

The power of rising bank rates can be enough for an UK economy to stall completely – which has already been hurt by the war against terror, the Recession and spending cuts that have come to no avail in the recent times.

Do let us know your predictions for the year 2011 in the financial sector, in the comments section below!