Market history · Central banks ·
The Bank of England raises rates first
On 16 December 2021 the Bank of England's Monetary Policy Committee voted 8-1 to raise Bank Rate from 0.1% to 0.25%, its first increase since 2018, according to the Bank's own summary. The move came with UK inflation well above target and the committee judged that it needed to act even as the Omicron variant spread.
It made the Bank the first of the major central banks to raise rates in the cycle. Many investors had expected it to wait until the new year, and the pound rose. The Federal Reserve and the European Central Bank followed in 2022, in much larger steps.
The takeaway
The first rate rise after a long period of low rates can come earlier than expected, and the larger moves usually follow.
Sources
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