BRC slams bank for hike
The interest rate has hit 5.5 per cent, the highest level in six years, raising concerns at the British Retail Consortium.

The Bank of England had been expected to increase the interest rate to curb inflation, largely fuelled by rising house prices.

Last summer, the interest rate stood at 4.5 per cent and has risen since then, in quarter percentage increments, to 5.5 per cent. Some analysts warn that there may be a further increase this year.

The BRC said that today's interest rate rise is premature and possibly unnecessary because inflation rates are expected to fall, regardless of changes to the interest rate.

BRC director-general Kevin Hawkins said: 'This rise is bad news for hard-pressed consumers and may turn out to be unnecessary. Customers' willingness to spend was already on the slide, shop prices are barely increasing and the bank's own inflation report forecasts a significant reduction in inflation in the second half of this year.'