Bank of England hikes rate despite banking turmoil

The Bank of England on Thursday hiked its interest rate for the eleventh time in a row, as policymakers seek to tackle soaring inflation despite turmoil in the banking sector.

The British central bank's Monetary Policy Committee voted at a regular meeting to lift its key interest rate by 25 basis points to 4.25 percent, the highest level since late 2008.

The announcement followed hikes in the United States, Norway and Switzerland.

Policymakers "will continue to monitor closely indications of persistent inflationary pressures, including the tightness of labour market conditions and the behaviour of wage growth and services inflation", the BoE said in a statement.

"If there were to be evidence of more persistent pressures, then further tightening in monetary policy would be required."

The decision had been widely expected after shock official data showed that British annual inflation accelerated in February despite central bank efforts to tame a growing cost-of-living crisis.

The Consumer Prices Index rose by 10.4 percent in the 12 months to February, up from 10.1 percent in January.

The news strengthened the case for another interest rate hike, despite calls for no change amid recent turmoil in the commercial banking sector.