Bank of England raises interest rates to tackle inflation

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The Bank of England raising interest rates in the UK

Part 1: The Bank's Decision The Bank of England has decided to raise interest rates in the UK. They are doing this to try to bring down inflation, which is when prices for things like food and toys go up. This is the 14th time in a row that the Bank has raised interest rates. They are going to increase the rates by a small amount. This will make the interest rate the highest it has been in 15 years. The Bank wants to keep inflation at around 2%, but right now it is too high.

How This Affects People

Part 2: How This Affects People When interest rates go up, it can affect people in different ways. For example, if you have a mortgage, which is a loan to buy a house, your monthly payments might go up. This is because the interest rate on your mortgage is tied to the Bank's interest rate. Also, if you have a savings account, you might earn more money because the interest rate on your savings might go up too. The Bank is hoping that by raising interest rates, they can bring down inflation and make things more stable for everyone.

Word of the day: Inflation

Inflation is when the prices of things go up. When inflation happens, the things you want to buy, like toys and food, become more expensive. This can make it harder for people to afford the things they need. It is important for the Bank of England to try to keep inflation low so that people can afford the things they need and want. See you soon for new articles!