The Bank of England have raised interest rates by half a percent point to 2.25% - the highest level since November 2008. Raising interest rates are one of the main tools the Bank of England has to bring down inflation, with the rationale being that higher borrowing costs will mean people are less likely to spend and more inclined to save.
In a statement, Chancellor Kwasi Kwarteng said he expects the Bank to take 'forceful action' to contain inflation.
The pound fell against the US dollar following the Banks announcement.
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