The increase, announced on Thursday (3 November), is the eighth in succession, and the first since Liz Truss and Kwasi Kwarteng’s disastrous mini-Budget.
Truss and Kwarteng’s plan spooked the financial markets, sending mortgage rates in particular soaring.
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The knock-on effect of another increase in interest rates will be significant for individuals and businesses alike, with more rises expected in the coming months to tackle inflation, which hit 10.1% in September.
The 0.75% increase in the biggest single hike since 1989, while the new rate of 3% is the highest since November 2008 at the height of the then-financial crisis.
Immediately after the announcement, the value of the pound fell to 1.123 against the US dollar and 1.15 against the euro.
The Bank of England further warned on Thursday the UK would likely face the longest recession for 100 years, which could last into the first half of 2024.
