"The Bank of England’s Monetary Policy Committee (MPC) sets monetary policy to meet the 2% inflation target, and in a way that helps to sustain growth and employment. At its meeting ending on 2 August 2023, the MPC voted by a majority of 6–3 to increase Bank Rate by 0.25 percentage points, to 5.25%," the bank said in a statement.
The rate has reached its record high since February 2008. In May and March of this year, the Bank of England raised the rate by 25 basis points, in February and June by 50 basis points.
Interest rates in the UK have been rising steadily recently amidst the cost of living crisis.
The UK, along with other European countries, is facing inflation and a massive energy crisis as part of the post-pandemic global economic recession. The situation has been exacerbated by the Ukraine crisis, as hostilities and Western sanctions against Russia have disrupted supply chains around the world.