THE Bank of England (BoE) today raised its main interest rate by a quarter point to 1% to tackle runaway UK inflation that is causing a cost-of-living crisis.

It was the fourth straight rate rise by the BoE, which added that British annual inflation would top 10% this year, fuelled by energy prices.

BoE policymakers voted 6-3 at a regular meeting for a hike to 1% – the highest level since the global financial crisis in 2009.

A minority called for a bigger increase to 1.25% while the BoE said in a statement that it “may need to increase interest rates further in the coming months”.

The latest increase came as Britons today headed to the polls in local elections, seen as a mid-term test for embattled Prime Minister Boris Johnson.

It also follows the Federal Reserve’s decision yesterday to raise US interest rates by half a percentage point as inflation soars also in the world’s biggest economy.

Central banks worldwide are raising rates, with inflation sitting at the highest levels in decades.

Prices are surging as economies reopen from pandemic lockdowns, and in the wake of the Ukraine war that is aggravating already high energy costs.

Britain’s annual inflation stands at 7% – the highest level in three decades, while a rate of 10% would be a 40-year peak. – AFP, May 5, 2022.