Bank of England raises interest rates
{{date|January 11, 2007}}

[[Image:London.bankofengland.arp.jpg|thumb|200px|right|The Bank of England in Threadneedle Street, London.]]

In a move widely viewed as surprising, the [[w:Bank of England|Bank of England]] raised UK interest rates from 5% to 5.25%, the highest in five years. In a press release the Bank stated that "an increase in Bank Rate of 0.25 percentage points to 5.25% was necessary to bring CPI inflation back to the target in the medium term".

The last publicly released value for inflation (measured according to the [[w:consumer price index|consumer price index]]) stood at 2.7%, above the Government target of 2%. However the Bank and Government receive advance figures, not due to be publicly released until next week. Analysts have speculated that these figures may explain the rise.

Following the announcement the [[w:FTSE 100|FTSE 100]] fell.

The Bank of England's [[w:Monetary Policy Committee|Monetary Policy Committee]] has been responsible for setting the UK's official interest rate each month since 1997. Prior to this the base rates were controlled by the Treasury and the [[w:Chancellor of the Exchequer|Chancellor of the Exchequer]].

In a separate decision the [[w:European Central Bank|European Central Bank]] maintained the interest rate within the [[w:Eurozone|Eurozone]] at its previous value of 3.5%.

==Sources==
*{{source-pr|url=http://www.bankofengland.co.uk/publications/news/2007/003.htm
|title=Bank of England Raises Bank Rate by 0.25 Percentage Points to 5.25%
|pub=Bank of England
|date=January 11, 2007}}
*{{source|url=http://news.bbc.co.uk/1/hi/business/6251963.stm
|title=Shock as UK rates rise to 5.25%
|author=
|pub=BBC News Online
|date=January 11, 2007}}
*{{source|url=http://www.timesonline.co.uk/article/0,,2-2542203,00.html
|title=Bank raises interest rates to 5.25%
|author=Dearbail Jordan
|pub=Times Online
|date=January 11, 2007}}
*{{source|url=http://today.reuters.co.uk/news/articlebusiness.aspx?type=businessNews&storyID=2007-01-11T142232Z_01_LAC002331_RTRUKOC_0_UK-BRITAIN-RATES.xml
|title=Bank raises rates near 6-year high
|author=Sumeet Desai
|pub=Reuters
|date=January 11, 2007}}

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[[Category:Economy and business]]
[[Category:United Kingdom]]
[[Category:Europe]]
[[Category:European Central Bank]]
[[Category:Bank of England]]
The Bank of England in Threadneedle Street, London.

In a move widely viewed as surprising, the Bank of England raised UK interest rates from 5% to 5.25%, the highest in five years. In a press release the Bank stated that "an increase in Bank Rate of 0.25 percentage points to 5.25% was necessary to bring CPI inflation back to the target in the medium term".

The last publicly released value for inflation (measured according to the consumer price index) stood at 2.7%, above the Government target of 2%. However the Bank and Government receive advance figures, not due to be publicly released until next week. Analysts have speculated that these figures may explain the rise.

Following the announcement the FTSE 100 fell.

The Bank of England's Monetary Policy Committee has been responsible for setting the UK's official interest rate each month since 1997. Prior to this the base rates were controlled by the Treasury and the Chancellor of the Exchequer.

In a separate decision the European Central Bank maintained the interest rate within the Eurozone at its previous value of 3.5%.
Economy and business United Kingdom Europe European Central Bank Bank of England