A 0.5 percentage point interest rate hike announced on Thursday was lower than expected – but will still add almost £600 to the average annual trailing mortgage and experts predict more hikes to come.

The Bank of England’s decision to deliver 2.25% defied market expectations and came despite the US Federal Reserve announcing its third straight 0.75 point hike.

He said he now expects GDP to fall by 0.1% in the current quarter, indicating Britain is in recession.