The UK's interest rate has been raised to 5.25% by the Bank of England, as it continues trying to control soaring prices.

This means the Bank has increased the rate by 0.25% from 5% - the 14th hike in a row.

The last time the base rate was this high was in April 2008.

The Bank of England is due to announce its latest interest rates in a few minutes.

We'll bring you the figures as soon as they're in, and from midday you'll be able to tune in to the BBC News channel's coverage of them by clicking the Play button at the top of this page.

Stay with us for all the latest reaction and analysis.

Michael Race
Business reporter

Rising interest rates can affect people in different ways.

Mortgage holders with variable or tracker mortgages, or who are looking to secure new fixed-rate deals, will see their monthly payments rise.

First-time home buyers may find they are priced out of the market as lending conditions become tighter. Charges will also increase for some loans and credit cards that don't have fixed interest charges, though it can take longer for higher interest rates to filter through to them.

Image source, EPA

But people with savings should benefit from higher interest rates and get better returns on their money - though banks have been condemned for "weak excuses" over savings rates on offer.

The rise may also be good news for those on the cusp of retirement, who might get a better annuity rate. This determines how much guaranteed income you get, when you swap some or all of your pension pot for a secure income. That's because providers typically buy government bonds, which will rise in line with higher interest rates.

For the government though, the rise in interest rates will have a knock-on effect meaning it has to pay more interest on the country's debt, making it more expensive to spend money on things like schools and hospitals.

Robert Cuffe
Head of statistics

The Bank of England’s projections on inflation have been optimistic over the last two years.

Every three months, it sets out what might happen over the next year or two to the prices we pay.

Those projections guide its decisions about interest rates. These have been going up because the Bank hopes making it more expensive to borrow - and better to save - will reduce demand and limit inflation.

Of course, projections are never precisely correct. Who could have predicted the pandemic or the war in Ukraine?

But of the Bank’s last eight projections, going back to August 2021, six have been lower than inflation turned out to be. The other two were higher.

That prompts a question. Might it have made different decisions if its models had spotted the severity of the UK’s inflation problem?

And so the Bank has announced a review of its forecasting models, citing a “need to adapt to a world in which we increasingly face significant uncertainty”.

As a reminder, raising interest rates is designed to reduce inflation.

Inflation, which measures the pace of price rises, was at 7.9% in June. That means prices on average are now 7.9% more expensive than they were 12 months ago.

• Inflation is now at its lowest for more than a year, but it is nearly four times higher than the Bank of England’s 2% target
• Also core inflation - which strips out volatile items such as energy and food - eased to 6.9% in the year to June from 7.1% in May
• Food has been one of the biggest drivers of inflation. The pace of food prices fell to 17.3% from May’s 18.3%, but they remain much higher than a year ago
• Prime Minister Rishi Sunak pledged in January - when inflation was at 10.1% - to halve price growth by the end of the year. Following June’s reading, there is still some way to go

Dame DeAnne Julius was one of the founding members of the Bank of England's Monetary Policy Committee - it was set up in 1997 and decides the UK's main interest rate.

She told BBC Radio 4's Today programme earlier that she believed it was "unlikely" the Bank would "make another big increase" to rates today.

But she added she didn't think the Bank was "overdoing it" on interest hikes due to inflation, the rate at which prices rise at, still being high.

"We are probably past the peak of inflation, but we do need to get it down considerably further, so I think it’s a matter of staying the course," she said.

Dharshini David
Chief economics correspondent

The Bank of England has doled out the medicine intended to cure high inflation - interest rate hikes - 13 times, and we are likely to see another dose dispensed today.

Those rate hikes act by deliberately squeezing budgets to influence spending, with, inevitably, painful side effects.

About half of residential mortgage holders will have seen their monthly bills rise since the end of 2021, typically by hundreds of pounds, as they either have variable-rate loans or have taken out new fixed-rate deals. Renters too may be struggling if their landlord passes on higher loan costs.

Inflation is easing, but remains far higher than the Bank would like. So economists think that rates will rise at least once more. But it takes a year or so for rate changes to influence the economy - leading to some concerns that the Bank goes too far and squeezes our budgets a little too much.

A little earlier on BBC Radio 4’s Today programme, a panel of guests shared their thoughts on the economy ahead of the BoE’s interest rate decision.

David Fox is the founder and chief executive of Tampopo with four restaurants in Manchester, two in London, and 160 staff - he tells the BBC that the current slowdown in business is the “worst it's been since the pandemic”. He says High Street footfall is down and the increase in interest rates is having an impact on his businesses. Fox says the repeated rate hikes might not sound much individually, but the “cumulative impact” is significant.

Jane Foley, head of FX strategy at Rabobank, agrees there is already “pain on the High Street”, and moves to reduce inflation have changed people’s spending habits. Foley also suggests a small rise won’t necessarily feed through to an increase in fixed mortgage deal rates if money market confidence increases.

Diane Wehrle is a retail analyst at MRI Springboard. She says July was a “perfect storm for the High Street” with railway strikes, bad weather and interest rate rises keeping shoppers away. She also points to a survey by her company which suggests more than half of all consumers are using their savings to make everyday purchases such as groceries, making people much more careful about their household spending.

In the wake of the global financial crisis of 2008, UK interest rates were slashed to historically low levels.

They were subsequently cut following the UK’s vote to leave the European Union in 2016 and again during the Covid pandemic, taking the rate to just 0.1%.

Image source, .

But as you can see from the graph, interest rates began climbing at the end of 2021 and accelerated the following year after Russia invaded Ukraine, which sent oil, gas and food prices higher.

UK interest rates are now at their highest for nearly 15 years. But if that seems a little eye-watering, spare a thought for people back in 1979 when the interest rate hit 17% and inflation was in double-digits.

It was also the year that Art Garfunkel sold the most singles in the UK with Bright Eyes, the theme tune to terrifying animated rabbit-fest Watership Down.

Anyway, the Bank of England is widely expected to raise rates from 5% to 5.25% on Thursday.

But some speculate the Bank could tighten the screws even further, and lift rates to 5.5%.5%.

Michael Race
Business reporter

One of the Bank of England’s main jobs is to keep inflation - the official measure of how quickly prices are rising - at 2%.

Currently, inflation is at 7.9%. It has been higher than that level for some time and although it has fallen recently, the rate isn’t falling as fast as hoped.

The economic theory behind increasing interest rates is that by making it more expensive for people to borrow money, they will then have less excess cash to spend, meaning households will buy fewer things and then price rises will ease.

But it’s a balancing act. Raising rates too aggressively could cause a recession, but not raising them at all could lead to inflation rising even more.

Not all economists even agree that the Bank should be raising interest rates.

You can read more on the Bank of England's role here.

Faisal Islam
Economics editor

Rise number 14, and a new 15-year high in interest rates at 5.25% - that’s what is expected when the Bank of England announces its latest interest rate decision at noon today.

With signs that inflation is slowly easing, all eyes will be on any indications of how much higher interest rates could go, and for how long they will stay above 5%.

While British inflation is still the highest of the G7 group of wealthy nations, the UK has so far avoided a recession, as seen in Germany.

However, the economy has not grown in size since the three-month period before the pandemic, amid a rolling series of economic and energy crises.

There are some signs that the sharp rise in rates from just above zero to over 5% has begun to impact the housing market, and insolvencies are now at the highest level in 14 years. But the job market remains buoyant, with wages in cash terms still rising sharply.

The Bank’s decision to increase rates by 0.5% last time has calmed some jitters in the markets. But it remains a delicate moment for the economy.

Dearbail Jordan
Reporting from the Bank of England

Hello from the Old Lady of Threadneedle Street. That’s not a reference to yours truly - it’s the affectionate name for the Bank of England and her address.

BBC apprentice Ez Roberts and myself are about to descend into the basement of the Bank, where we will get a first look at the interest rate decision as well as the quarterly Monetary Policy Report.

Before that though, all reporters are required to put their mobile phones in a secure locker. This ensures that no detail of the interest rate decision can leak out before it is officially announced at midday.

The security measures continue in the room before we get our mitts on the documents: the wi-fi will be disconnected and we’ll be locked in.

And because the Bank is publishing its Monetary Policy Report this month, we get two hours instead of the usual one to read, ruminate and write our reports - fuelled by lots of tea and biscuits, of course.

Moments before 12:00, Bank staff give us the wi-fi code and you’ll be able to read our news story straight away.

See you on the other side.

Ahead of the Bank of England's interest rate decision, a small group of protesters have gathered in Threadneedle Street to voice their opposition to rising rates.

The Bank is widely expected to increase rates to 5.25% at midday, but protesters outside the building are holding placards that argue against the move, with one saying: "Pay rises, not rate rises."

Image source, PA Media

At noon, the Bank of England will publish its interest rate decision.

Before that, however, our colleagues Faisal Islam and Dearbail Jordan will be locked in the Bank’s basement. That’s because the media get some extra time to pore over the report - and write a news story - before it is released publicly.

Usually, reporters are given an hour’s grace before the announcement is unveiled, but today is different because the Bank is also publishing its Monetary Policy Report.

This report - which is released four times a year - basically sets out the Bank’s expectations for the UK. It will cover things like how quickly, or slowly, the Bank expects inflation to ease as well as its outlook on the strength of the UK’s economy.

So, this time around, Faisal and Dearbail will be locked in the basement for two hours.

After that, Bank of England Governor Andrew Bailey and other key figures will give a press conference and we’ll hear what they have to say about the rate decision.

Interest rates are the extra money that gets charged on top of a loan repayment. For example, if you borrow £100 from a bank and it charges a 5% interest rate, you will pay back £105.

The Bank of England is the UK’s central bank and it is independent from the government.

It sets a “base rate” and this influences how much lenders will charge borrowers who take out a mortgage, a loan or a credit card. So if the Bank of England puts its interest rate up, that usually means you'll pay more interest on borrowed money - unless you’ve borrowed it at a fixed rate.

Interest rates are often a big deal for people with mortgages, especially those who do not have a loan with a fixed rate.

But it is not all bad news, as higher interest rates should mean an increase in the interest people earn on savings - though banks can be slow to pass on these rises.

• Read more: How an interest rate rise affects you and your money

Jamie Whitehead & Alexandra Fouche
Live reporters

Good morning, and welcome to our live coverage as we wait for the Bank of England’s latest decision on interest rates at midday.

The UK’s official interest rate, which is also known as the “base rate”, currently stands at 5%. That’s the highest for 15 years - and it is predicted to go even higher today.

The expectation is that we will likely see interest rates rise to 5.25%. That would be a smaller increase than the sharp hike the Bank announced in June.

However, nothing is certain when it comes to interest rates.

While the rate of inflation is slowing, it is still high at 7.9% in the year to June. There is a possibility - admittedly a remote one - that interest rates could hit 5.5%. They could even stay at 5%.

Whatever happens, stay with us throughout the day as we explain what rising interest rates mean for mortgages, credit cards, savings and everything else it affects.