The Bank of England has announced that interest rates in the UK will rise to the highest level since 2008.
Members of the Bank of England's Monetary Policy Committee voted to raise the interest base rate from 1.75 per cent to 2.25 per cent, while three voted for an even steeper increase to 2.5 per cent. Previously, the central bank predicted the economy would grow in the current financial quarter but is now saying Gross Domestic Product (GDP) will fall 0.1 per cent.
It comes after a reported 0.2 per cent fall in GDP during the second quarter - meaning the economy is now in recession. In committee minutes, the bank said the "tight labour with wage growth and domestic inflation" above targets has called for a "forceful response".
