The Bank of England's monetary policy committee (MPC) today voted to raise the base rate of interest when it held its monthly meeting.

Following the addition of a quarter per cent, the base rate now stands at 5.5 per cent, higher than in other western countries such as the US, where it is 5.25 per cent.

The move was made in an attempt to curb rising inflation, which was revealed to have breached a three per cent upper limit in March.

Following that revelation, the governor of the Bank of England, Mervyn King, was required to write a letter of explanation to the chancellor.

In the letter, he stated that the Bank is "determined" to bring inflation back under control.

There have now been four interest rate rises in the past 12 months and some analysts are predicting that the base rate will touch six per cent before the end of the year.

© Adfero Ltd