The Bank of England raised its base rate to 4.5 percent, warning that inflation will decline more slowly than originally anticipated.
The central bank has raised interest rates for the 12th time in a row in an effort to slow price increases.
The Bank of England has set an inflation target of 2%, yet it is currently at 11.6%.
Food prices have been higher for longer than expected, according to the Bank, which justified its decision.
According to the report, the sustained high costs are attributed in part to Russia’s war in Ukraine and low harvests in other European countries.
Seven of the nine members of the Bank’s Monetary Policy Committee (MPC) decided to raise the basic interest rate from 4.25 percent to 4.5 percent.
According to the MPC, inflation will continue to fall dramatically beginning in April this year as energy prices fall and household bills are subsidised.
It predicted that the Consumer Price Index (CPI) would fall to little over 5.1 percent by the fourth quarter of current year.
The base rate of interest affects the rates charged by commercial banks throughout the country.
This also means that the increase will almost certainly result in higher mortgage repayment rates.