Bank of England Raises Interest Rates in Response to Inflation Surge

The Bank of England has raised interest rates by a quarter of a percentage point to 4.25%, its 11th consecutive rate hike, in response to a surprise increase in inflation in February. The bank said it would raise rates further if there were evidence of more persistent price pressures. The UK economy is expected to shrink this year, and small businesses are facing a double-whammy from rising prices and rising borrowing costs. Some economists suggest the central bank may even be considering rate cuts by the end of the year.