Bank of England raises interest rates to 1.75 percent
The Bank of England has raised interest rates by 0.5 percentage points to tackle the soaring cost of living, despite concerns that the economy is heading for a recession.
It is the biggest increase in rates in 27 years as policymakers at the central bank voted to raise the base rate for a sixth time in succession to 1.75 percent in line with the expectations of City economists.
The decision takes UK rates to the highest level since the end of 2008 after the biggest single rise since 1995.
Inflation is increased to 9.4 per cent in the year to June and is expected to rise further over the coming months.
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Almost two-thirds of the public say they are concerned about rising interest rates as the Bank of England considers another hike in the cost of borrowing, amid soaring energy costs.
Experts are warning that inflation could peak at 15 per cent, adding to the already painful cost-of-living crisis with spiralling prices.
Former chancellor Rishi Sunak said his Foreign Secretary rival Liz Truss would further drive up interest rates, raising mortgage payments, with her plans.
Mr Sunak has faced attacks from Ms Truss for overseeing rising taxes while in No 11 during the pandemic, as she pledges a more radical plan to slash them.
He has insisted he does want to see taxes come down, but argues it is necessary to bring inflation under control before making major changes.