The Bank of England took markets by surprise today with a hike in interest rates by 0.25 % to 0.75% at today's meeting of the B of E's Monetary Policy Committee.  The nine members of the MPC decided were unusually all onboard this unanimous decision to increase borrowing costs, which will no doubt be reflected in similar rises from mortgage lenders and other forms of business and consumer finance.

The general analyst feeling was that rates would be nodded through unchanged, so this small but significant rate increase, caused a somewhat larger stir than usual. Savings accounts might eventually benefit but the rates in general are pretty dismal and will be a fraction less dismal. There have been few reasons to buy the pound on Foreign Exchange markets but sterling made a small initial gain on the unexpected nature of the Monetary Policy Committe's decision.