In an effort to rein in persistently high price increases, the Bank of England has increased UK interest rates more than anticipated.
Rates were raised by the Bank to 5% to 4%, the highest level since 2008.
Many mortgage holders who are already dealing with skyrocketing borrowing costs will see an increase in repayments as a result of the decision.
If banks choose to pass them on, it should, in theory, mean better rates for savers.
It comes after official data on Wednesday revealed that May's inflation rate, which measures the annual rate at which prices increase, was stuck at 8 point 7 percent, significantly higher than anticipated.
Inflation in the services sector remained consistently high, according to the Monetary Policy Committee (MPC), which determines UK interest rates, while wage growth exceeded expectations.
Domestic price and wage developments, it continued, "were likely to take longer to unwind than they did to emerge.".
The MPC approved the largest increase since February, a 0.5 percentage point increase, by a 7-2 vote.
The committee's two members voted to keep rates unchanged.
According to Bank of England governor Andrew Bailey in a letter to Chancellor Jeremy Hunt, as energy prices decline throughout the year, overall inflation is still expected to decline "significantly.".
However, he went on to say that the Bank would continue to closely watch inflation and would tighten monetary policy if there "were evidence of more persistent pressures."
