Bank of England hikes interest rates in clamour to contain inflation

The move follows hot on the heels of a rate hike in December, marking the first back-to-back increases in Bank Rate since 2004

The Bank of England raised interest rates to 0.5% on Thursday and nearly half of its policymakers wanted a bigger increase to contain rampant price pressures, as the British central bank warned inflation will soon top 7%.

In a surprise split decision, four of the nine members of the Monetary Policy Committee wanted to raise interest rates by half a percentage point to 0.75% in what would have been the biggest increase in borrowing costs since the BoE became operationally independent 25 years ago.

The majority, including Governor Andrew Bailey, voted for a 0.25 percentage point increase.

The pound jumped