Samuel Mather-Holgate, from Mather & Murray Financial, said: “Increasing rates, knowing the last rises haven’t been felt yet, and whilst inflation is falling, is absolute lunacy.
“Only one member of the Monetary Policy Committee wanted to maintain its previous level and they should be applauded.
“This further rise will add misery to homeowners and those with business finance. An already lifeless housing market will shrink further into itself, not to reappear until Spring.”
The central bank has consistently hiked the base rate since December 2021 in efforts to bring down inflation, which has been dropping in recent months.
Mr Mather-Holgate added: “The Governor needs to get a grip and reverse these hikes before the end of the year.
“Thankfully, the next inflation print might just give him the impetus to pause and reflect on his insane mission to bash borrowers.”
The latest increase means people on variable rate and tracker mortgages will see their monthly repayments increase again.
For a person on a tracker rate, an increase from five percent to 5.5 percent costs around an extra £58 a month on a £200,000 loan taken over 25 years.
Their monthly repayments would rise from £1,170 to £1,228, adding to other pressures from the rising cost of living.
Chancellor of the Exchequer, Jeremy Hunt said: “If we stick to the plan, the Bank forecasts inflation will be below three percent in a year’s time without the economy falling into a recession.
“But that doesn’t mean it’s easy for families facing higher mortgage bills so we will continue to do what we can to help households.”
Inflation fell to 7.9 percent in the latest figures for the year to June, with the Bank of England predicting it will fall to 4.9 percent in the final quarter of this year, and stay above two percent until mid-2025.
Food prices continue to rise sharply above the pace of overall inflation, with food inflation at 13.4 percent in July.
The central bank is predicting food inflation will fall to around 10 percent by the end of the year.
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