Interest rates have been increased to 4.25% from 4% by the Bank of England (BoE) as it tries to slow rising prices.
The BoE’s decision to increase rates for the 11th time in a row comes after figures showed that the cost of living has risen by more than expected. Data published recently by the Office for National Statistics (ONS) showed that inflation jumped to 10.4% in the year to February, despite predictions it would fall.
The Monetary Policy Committee (MPC) voted in favour of the latest rise by a majority of seven to two.
Commenting on 23 March, David Bharier, Head of Research at the British Chambers of Commerce (BCC), said:
‘Today’s decision to increase the interest rate indicates the Bank are still pursuing strong action following yesterday’s surprise rise in inflation. Record high inflation remains the top issue of concern for SMEs and it has been wiping out their ability to invest and grow for almost two years now.
‘However, an interest rate rise alone is a blunt instrument that doesn’t address some of the fundamental causes of inflation, such as failure in the energy market and global supply chain shocks.’