BoE unanimously votes to raise rates to highest in a decade

The Bank of England has taken the decision to raise the UK interest rate by a quarter of a percentage point to 0.75% from 0.50%. This 0.25% rise marks the highest interest rate level seen in the UK for nearly a decade. Whilst markets had largely priced in the hike, the unanimous vote to raise rates caught some investors off guard with level of commitment being shown to tighter financial conditions given the ongoing uncertainty surrounding the UK’s exit from the EU. Along with the rate hike the Bank of England also upgraded their longer term inflation forecast to above average and increased their GDP growth predictions for 2019. The upgrades to growth and inflation have sparked speculation that the Bank of England could be intending to raise rates faster than previously envisaged.