When did the Bank of England last raise interest rates and what is the current level?

THE Bank of England is set to raise the interest rate for the second time in a year – but when was the last time they did it?

Here we explain when it last happened, what an interest rate rise is, and what the current level is…

A rise would mean that the base rate would be set at the highest it’s been in a decade

When did the Bank of England last raise interest rates?

The Bank of England last raised interest rates in November 2017, hiking it from by 0.25 per cent.

It was the first interest rate increase since July 2007.

The announcement led to the pound dropping 1.5 per cent against the euro to 1.257.

It also fell by almost 1 per cent against the dollar.

What is the base rate?

SIMPLY put, it’s the country’s official borrowing rate, and is the rate the Bank of England lends to all the other banks in the UK

It is incredibly important as it a guide for lenders on what rates it can offer – and therefore impacts mortgage rates, credit cards, loans and savings.

It was stuck at record low levels for a decade because of the state of the economy after the financial crash in 2008.

It was raised back to 0.5 per cent last November, but after today’s decision by the Bank has seen markets pencilling in more than three hikes within three years., starting later in 2018

A 0.25 per cent hike in interest rates could see mortgage bills go up by £264 a year

What is the current level?

The current level is 0.5 per cent – but experts are expecting it to rise to 0.75 per cent.

This means that the 3.7million borrowers who are on variable and tracker mortgages could see their monthly bills go up as lenders look to pass on the costs.

In fact, mortgage-holders could see their bills go up by as much as £264 if the rate does rise.

A rise is good news for savers though who could see the amount of interest they earn on their cash go up – but only by a measly £25 on £10,000, if banks decide to pass them on.

We pay for your stories! Do you have a story for The Sun Online news team? Email us at tips@the-sun.co.uk or call 0207 782 4368 . You can WhatsApp us on 07810 791 502. We pay for videos too. Click here to upload yours.