The Bank of England has raised the interest rate for only the second time in a decade.
The rate has risen by a quarter of a percentage point, from 0.5% to 0.75% – the highest level since March 2009.
The move will increase the interest costs of more than three-and-a-half million residential mortgages that have variable or tracker rates.
But it will be welcomed by savers, who could see a lift in their interest rates over the coming months.
However, after the last rate rise in November, half of savings accounts did not move at all.
Why are they doing this now?
The Bank’s Monetary Policy Committee had been expected to raise interest rates in May, but held fire because the economy went through a weak patch at the start of the year – partly because of the harsh weather conditions, dubbed the Beast from the East.