The Bank of England has revealed its latest decision on base rate – which in turn has a strong influence on interest rates.

Its monetary policy committee has agreed to keep base rate at 5.25 per cent.

The Bank has been hiking rates since December 2021 in an effort to tackle inflation in the UK, which is running at 6.7 per cent – far above the 2.0 per cent target rate agreed.

In the minutes from its latest meeting, the MPC says that since June inflation had fallen much faster than expected to 6.7 per cent in August.

Simultaneously there were “increasing signs” that higher rates were starting to hurt the UK economy.

For these reasons the MPC says it kept rates on hold but warned they must remain “sufficiently restrictive for sufficiently long” to get inflation back down to 2.0 per cent.

Chancellor Jeremy Hunt says: “We are starting to see the tide turn against high inflation, but we will continue to do what we can to help households struggling with mortgage payments.

“Now is the time to see the job through. We are on track to halve inflation this year and sticking to our plan is the only way to bring interest and mortgage rates down.”