We're now closing our live coverage of the Bank of England's 13th successive interest rate hike.

For more reading, reaction and analysis have a look at:

• Bank of England governor admits rise painful for many
• 'I saved £50,000 living abroad but still can't afford a mortgage'
• Force banks to offer mortgage help, says Labour
• Five ways to save money on your mortgage deal
• How the interest rate rise affects you and your money

Or, if you're feeling a bit baffled by all this economics, have a listen to this BBC podcast series - Understand: The Economy.

Today's page was written by Michael Race, James Harness and Thomas Mackintosh and edited by Heather Sharp.

We'll be closing our live coverage shortly, but here's a recap of what's happened today after the Bank of England's decided - again - to increase interest rates in order to try to bring down stubbornly high inflation.

• The Bank's interest rate has gone up from 4.5% to 5% - it's highest level in 15 years and a bigger rise than most forecasters expected

• Seven out of nine of the Bank's Monetary Policy Committee members voted in favour - though two voted for no increase

• The Bank's governor, Andrew Bailey, said "we know this is hard" but "if we don't raise rates now, it could be worse later"
• PM Rishi Sunak said he was "totally on it" when it comes to tackling inflation, but admitted it had "got harder" to meet his target of halving inflation
• Labour leader Keir Starmer said mortgage holders and families were "paying the price of Tory failure"

Image source, PA Media

We've been inundated with reaction to today's interest rate decision by the Bank of England - both in favour and against it. Here's a flavour of some of the different views.

Anna Leach of the Confederaton of British Industry (CBI) says the Bank had no other option but to go for a "bumper rate rise" - though the it will "come as a blow to hard-pressed households and businesses who are struggling with rising costs".

Sharon Graham of the trade union Unite said the Bank had made the "wrong choice" in "inflicting pain on ordinary households".

She said the rise was "nothing more than a hand-out" to banks who had already "made bumper profits".

Jonathan Samuels, chief executive of loan company Octane Capital said while 0.5% jump was "probably appropriate" and "should help the Bank of England regain a grip over the situation at hand".

Analysts from Dutch bank ING said it seems likely that the Bank will hike rates again in the coming months, though more likely with two further 0.25% increases than another 0.5% rise.

And finally, Economist Mohammed El-Erian told the BBC he feels Brexit has been a factor in the 13th successive hike.

"We decided to redefine our trading relationships. that has disrupted our supply chains. That sets us apart and explains why our inflation is higher and more stubborn than what we see elsewhere."

Image source, PA Media

We heard earlier from Labour's shadow chancellor Rachel Reeves - party leader Sir Keir Starmer has now weighed in too, saying mortgage holders and families are "paying the price of Tory failure" following today's interest rate rise.

Speaking in Uxbridge, Sir Keir says Labour has set out a "positive plan" to help people through the crisis which would involve mortgage lenders being required to offer more flexibility.

Asked how it was different from the government, Sir Keir answered: "The Government is urging, we are requiring. We're saying you've got to do this."

What else could the government do to tackle inflation ?published at 16:15 British Summer Time 22 June 2023

16:15 BST 22 June 2023

Dharshini David
Economics correspondent

Image source, EPA

As borrowers’ pain increases, the question about what else can be done is intensifying.

Higher interest rates mean borrowers have less to spend and savers more incentive to put cash away.

Tax rises could also curb spending but the government is unlikely to enact that close to an election - replicating the impact of higher mortgage rates would be the same as raising the basic rate of income tax by at least a couple of percentage points.

As it is, the policy of not increasing the thresholds at which higher rates of income tax apply in line with wages means many workers are seeing more taken out of pay packets.

Direct price controls on food have been mooted. But with profit margins tight in some parts of the food chain that could risk damaging supply.

The chancellor has said that he’s engaging with food retailers and energy regulators to encourage the passing on of cost savings quickly - but that doesn’t stop them trying to rebuild margins.

He’s also indicated that he’s aiming to curb public sector wage increases - but attempts there will be resisted by workers.

Now you may have seen in our reports on inflation that yesterday's rate of 8.7% came as a surprise, because it had been forecast to fall.

Bank of England governor Andrew Bailey was also asked about the accuracy of the Bank's forecasting, and it said it had announced an external review of forecasting.

"Forecasting has been very difficult in an era with such big things going on around us, there's a war, obviously we've had the pandemic, we need to understand how we can best respond to those sorts of shocks," he said.

Here's a little bit more from Bank of England governor Andrew Bailey - who was asked whether requests for large pay rises are adding to UK inflation.

Bailey has previously said that people shouldn't ask for big wage increases to avoid fuelling inflation. Some economists have suggested there are signs that what's known as a "wage-price spiral" is emerging, where pay increases force prices up further and high inflation lasts for a longer time.

He says in order to get inflation down, "we cannot continue to have the current level of wage increases".

"We can't have companies seeking to rebuild profit margins which means prices continue to go up at their current rates," he adds.

Bailey says the Bank expects inflation to drop, but says it is "important then that price setting and wage setting reflects that, because the current levels, I'll be absolutely honest, are unsustainable."

What's happing to mortgages in other countries?published at 15:55 British Summer Time 22 June 2023

15:55 BST 22 June 2023

Dharshini David
Economics correspondent

It may be of little comfort to beleaguered mortgage holders - but we’re not alone.

The rates on new deals in many other countries have doubled or tripled over the last 18 months or so, as their policymakers too tackle soaring inflation.

You can see in the graph below how central banks' base rates vary in different countries - but the way the impact on mortgage holders differs is a bit more complicated.

In the US and some of Europe, fixed rate deals of much longer duration - 25 or 30 years - tend to be the norm. In some, mortgage holders can switch deals with minimal penalty. That shields many from the impact of rising rates more than in the UK.

The French government effectively caps rates - meaning a 30-year mortgage deal should cost 3.5%, while in America it would attract a rate of over 6%

The most accurate way to compare homeowners' plight is by effective rates - the average across all existing and new home loans.

In the UK, where the majority are on two or five-year fixed deals, that’s just below 3% (although that will rise as more mortgage holders re-fix existing loans). In France and Germany it’s below 2%, while it’s typically higher in the US.

Image source, .

We've heard this afternoon from the prime minister speaking in Kent - but it's also worth recapping what he said earlier, just after the Bank of England announced its decision to hike interest rates to 5%.

"The reason interest rates are going up is because inflation is too high and we've got to bring it down," Sunak told the Times CEO Summit.

“Now, I always said this would be hard - and clearly it’s got harder over the past few months - but it’s important that we do do that.

“The government is going to remain steadfast in its course and stick to its plan,” he added.

Will the government help with the financial squeeze?published at 15:32 British Summer Time 22 June 2023

15:32 BST 22 June 2023

Kevin Peachey
Cost of living correspondent

Sarah Cave asks: Is the government going to be offering assistance to those of us who own our homes and now can't afford to eat or pay bills?

Ministers say they are already helping out by subsidising energy bills and offering cost-of-living payments to those on low incomes who receive benefits.

Beyond that, there will now be lots of attention on a meeting tomorrow between the chancellor and mortgage lenders.

No doubt, he will demand that they scale up support for those who are struggling to pay.

However, there is little chance of direct intervention from the government that would help homeowners pay their mortgages.

Will mortgage lenders now be stricter on how much they lend?published at 15:26 British Summer Time 22 June 2023

15:26 BST 22 June 2023

Kevin Peachey
Cost of living correspondent

Iain Low asks: Are the interest rate rises also going to impact the income multiples lenders are prepared to offer?

The general view is probably not, but there will be an impact on the affordability assessments they carry out.

When you apply for a mortgage, a lender will test whether you would be able to repay at a higher interest rate than now.

As rates rise, that gets harder for people to pass. This can be a particular issue for young first-time buyers who may have relatively low and irregular wages.

Is the Bank of England repeating a mistake?published at 15:17 British Summer Time 22 June 2023

15:17 BST 22 June 2023

Kevin Peachey
Cost of living correspondent

Tom, from London, asks why is the Bank of England doing the same thing over and over and expecting different results?

This is the 13th interest rate rise in a row. Critics will say that's been unlucky for everyone.

One school of thought is that these rises have been having a very limited impact. The inflation rate has come down from its peak of 11.1%, but now appears to be stuck at 8.7%. In the meantime, the financial pain is intense - particularly for a young, homeowning, few.

The other side of this argument is that interest rates take time to feed through. The Bank needs to stick to its guns and give it time.

It is not for me to say who is right or wrong, but it is interesting to note that among the nine members of the Bank's Monetary Policy Committee - which sets rates - seven voted for today's increase, but two voted for no rise at all.

BBC political editor Chris Mason now questions the prime minister over his assertions that everything is going to be OK.

Mason asks if the "blunt truth" is that for some people, it won't be ok?

"I've never said this is going to be easy getting inflation down, I have always said this is going to be tough and it's going to take time," Sunak replies.

"But I'm determined to do and it is right that we do it."

He makes the point that bringing inflation down will benefit everyone.

Next up is a question from Sky News, about whether Sunak regrets making halving inflation a personal priority - and whether asking people to hold their nerve could cost him and his party at the ballot box.

"I don't think it was a mistake to set halving inflation as my number one priortiy," he says.

I am ambitious for our country, he says.

Sunak reiterates he is doing everything he can in order to bring inflation down.

"That is how you restore trust in politics," he says. "Set out what you want to do and work your hardest to deliver it."

Sunak is now facing questions from the media and is asked first up if an economic recession is a price worth paying for getting inflation down.

"Nobody wants to see a recession," he says.

The prime minister says part of the reason prices are rising is because the "economy has done better" and that the UK had previously avoided a recession.

He repeats that halving inflation is the "right priority" in order to fund "all the things we want".

"Anyone who tells you there's a shortcut is not being straight with you," he adds.

Image source, Pool

After finishing his speech, Sunak is now taking questions from members of the business community in the audience.

He is asked about the economic strategies which are in place to achieve his objective of halving inflation.

Sunak says: "The first and foremost way is through interest rates."

He then says politically, his government should not be borrowing too much.

He also says he wants to bring more workers into the labour force and increase energy supplies.

How can I secure a decent mortgage rate?published at 14:48 British Summer Time 22 June 2023

14:48 BST 22 June 2023

Kevin Peachey
Cost of living correspondent

Wasif Mahmood asks: What can we do to make sure we are in the best position to secure a mortgage deal now before the next, inevitable, rate rise?

We've asked the same question to mortgage brokers. Their response: prepare in plenty of time, consider all the options, but be prepared to act swiftly.

Of course, which home loan to choose, and when, depends on your personal circumstances.

Brokers are urging people to have a chat six months before a mortgage deal expires. If things are really looking tight, then there are ways that you might tackle the problem - albeit with pitfalls of their own.

My colleague Marc Ashdown has outlined some of them here.

Money markets are betting on the Bank rate to eventually rise to 6%. Mortgage lenders will already have factored some of that into pricing their new fixed deals, but there could clearly be further hikes to come.

Our cost-of-living correspondent Kevin Peachey is answering your questions about today's interest rate hike from 4.5% to 5%.

We're also been watching as Prime Minister Rishi Sunak speaks to business leaders in Kent - he's just assured them he is "totally on it" when it comes to tackling inflation.

He's answering their questions now, and we're listening across.

Stay with us for live updates, more answers to your questions and more analysis from our expert correspondents too.

What does this mean for renters?published at 14:42 British Summer Time 22 June 2023

14:42 BST 22 June 2023

Kevin Peachey
Cost of living correspondent

Kimberly asks: I’m currently looking for a flat to rent. How will the interest rate hike affect renting, particularly when it’s already such a brutal market?

It is hard to see how this can be anything but bad news for people like Kimberly.

The average rent for a new let is already more than 10% more expensive than it was a year ago, according to data from the property portal Zoopla.

Landlords, particularly in London and the south-east of England, who may already be borrowing quite heavily, now face further increases in the mortgage rate they pay. In turn, they may well put up the rent for new tenants to help cover the cost.

The National Residential Landlords Association has just said that rate hikes will lead to more landlords selling up, cutting the number of rental homes that are available, and so increasing competition - and rent - on the homes that remain.

None of this happens in isolation though. Ministers and the Bank of England would say Kimberly and everyone else are being hit hard by persistent price rises.

What about giving tax relief to homeowners?published at 14:39 British Summer Time 22 June 2023

14:39 BST 22 June 2023

Kevin Peachey
Cost of living correspondent

Peter asks: if the government were to reintroduce tax relief on mortgages wouldn’t it help both those buying and those renting, as it would keep the costs for those letting the property down?

Some Conservative MPs have been calling for the chancellor to bring back this policy.

It was once the case that some homeowners could get tax relief on their mortgage interest payments. In practice, that would reduce the cost of their monthly repayments.

However, Jeremy Hunt has ruled this out.

He says that would pump money back into the system, making it more likely that the inflation rate would rise - and high inflation is exactly the problem they want to solve.