UK interest rates expected to rise for 12th time in a row

According to economists and the financial markets, the base rate will rise for the 12th consecutive time as inflation continues to soar.

Policymakers at the Bank of England are expected to raise interest from 4.25% to 4.5% on Thursday, representing a 0.25 percentage point increase.

This means it will be more expensive to borrow which will push banks to lift saving rates.

The central bank has been increasing interest rates since December 2021 to try to control inflation, which currently stands above 10%, BBC News reports.

It is expected there will not be too many more interest rate rises in the near future (Image: PA)

When will interest rate rises come to an end?

Despite this latest expected increase, it is anticipated that outside of one or two more rises it may be coming to an end.

BBC News adds: "The Bank will be keen not to dampen the economy, which has shown little sign of growth.

"The peak would be lower than initial predictions after the turmoil of last year's mini-budget."

Ellie Henderson, from Investec Economics, said the “clock is ticking” on the Bank’s monetary policy tightening cycle, and an increase on Thursday could be the last.

She said: “As things stand and considering the sharp downward influences on inflation in the coming months, namely from energy but also from cooling food and goods price inflation, we suspect that this could be the last hike by the Bank of England in this cycle.”

How does the interest rate rise affect me?

The interest rate rise could make monthly mortgage payments more expensive and could impact the amount charged on things such as credit cards, bank loans and car loans.

Additionally, people should be getting a higher return on their investment in saving accounts at banks and building societies.

However, interest rates are not keeping up with rising prices so the value of cash savings is falling in real terms.