After a significant increase in the interest rate of the Bank of England, aimed at curbing inflation, the leading UK stock indexes continued their decline. This has increased concerns about a slowdown in the British economy. The FTSE 100 index fell by 1.2% and reached a three-week low under the pressure of a sharply increased pound. The FTSE 250 index also fell 0.9%. The real estate, real estate and banking sectors suffered losses of about 2% and led the decline. The Bank of England on Thursday raised its key interest rate by 50 basis points – from 4.5% to 5%, reaching the highest level since 2008. Market participants now believe that the rate will reach its peak in February and will be 6.05%, while before today's decision it was forecast at 5.9%. Analysts note that the FTSE 100 index is lagging behind other world indices this year due to the volatility of commodity prices and the tough position of the Bank of England. The European STOXX 600 index has grown by 6.5% since the beginning of the year, and the American S&P 500 index – by 14%. Other central banks also raised rates today: the Central Bank of Norway immediately raised the rate by 50 bps, to 3.75%, the highest since 2008. And the Central Bank of Switzerland – by 25 bps, up to 1.75% per annum.
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