THE TEKEGRAPH: Policymakers vote to raise rates from 3.75pc to 4pc, the first increase since August 2023
The Bank of England has raised interest rates for the first time in three years and warned households to brace for further pain.
Policymakers voted to raise rates from 3.75pc to 4pc on Thursday, the first increase since August 2023.
Britain’s borrowing costs rose and the pound edged up as the Bank signalled there could be another increase before Christmas.
The Bank blamed the ongoing conflict in the Middle East for triggering another sharp jump in energy prices, with John Healey’s maiden Budget doing little to ease a two-year decline in household incomes.
Threadneedle Street now believes inflation will peak at around 5pc by the middle of 2027, even if the economy slows sharply.
However, policymakers said price rises would peak at 6pc next summer if the Iran war did not end.
The Bank also laid bare the impact of the conflict on family finances, with Donald Trump’s war pushing up mortgage costs for the average household by £1,500. » | Szu Ping Chan Economics Editor. Chris Price Markets Editor | Thursday, November 5, 2026
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