Bank of England Act 1998

The Bank of England Act 1998 established the Bank of England's independence in setting monetary policy, particularly interest rates, to control inflation. Before this, the government had more direct influence over the Bank’s decisions. This change aimed to enhance economic stability and credibility, allowing the Bank to focus on maintaining price stability without political pressure. The Act also created the Monetary Policy Committee, which is responsible for reviewing economic conditions and setting interest rates, helping to ensure a more systematic approach to managing the UK’s economy.