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The Bank of England has raised interest rates for the first time in more than three years, and the cost it is fighting is one it has no power to lower. Energy prices driven up by the conflict in the Middle East are pushing British inflation higher, and the Bank’s Monetary Policy Committee decided that waiting any longer risked letting fuel and heating bills seep into wages and shop prices for good. The move lands first on borrowers. Homeowners on tracker and variable mortgages will see their payments climb as lenders pass it on, and anyone coming off a cheap fixed deal is shopping in a market where loan pricing had already risen before the vote. Savers get a slightly better return, though one still eroded by prices rising almost as fast.
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