The Bank of England is expected to raise the base interest rate from 0.75 to 1 percent in a bid to stop inflation, British media reported. The bank tipped that it would be announced later in the day, as the authorities want to quell the recent spike in fuel and food and prices - since many Britons have suffered from skyrocketing energy bills after the cap went up by 54% in April.
However, if taken, the step will also affect at least two million homeowners with variable rate mortgages, and increase the cost of loans in general.
The hike will also push the rate to its highest point in 13 years - since it was dropped from 2 percent to 0.5 percent in 2009, following the financial crisis. It comes just a day after the US Federal Reserve increased the interest rate by 0.5 percent, marking the biggest hike in the past 20 years.
According to BoR Governor Andrew Bailey, the bank is now walking a "narrow path" between growth and inflation.