The Bank of England has increased the base interest rate from 5% to 5.25% in the 14th consecutive hike.

It is the highest interest rate rise since March 2008.

Rates have been consistently raised since December 2021 in an effort to make borrowing more expensive and dampen economic activity by taking money out of the economy. It’s all part of the effort to bring inflation down to 2%.

Latest official figures show the rate of inflation reduced more than expected to 7.9%.

Before those figures were released it was expected interest rates would peak above 6%.

Now, markets are bracing for around a 5.75% high by the end of this year.