Raise interest rates to protect savings, Bank urged

A campaign group has written to the Bank of England calling on its rate-setting Monetary Policy Committee to raise the cost of borrowing.

Save Our Savers argued that a combination of very low interest rates and stubbornly high inflation has wiped as much as £50 billion from the value of savings during the past year.

The MPC, however, has persisted with its policy of keeping rates low in an effort to encourage business lending and to boost the pace of economic recovery. Yet we know the banks are not lending.

An alternative view is that the real reason for the policy of maintaining low interest rates and allowing inflation is increase – is that the government will erode the value of the national debt over time.

If that is true then we will all pay the price for that type of policy, do you agree?

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