Bank of England announces surprise rate hike to 5.25% PrintDisable live quotesRSSDigg itDel.icio.usBy Simon Kennedy Last Update: 7:03 AM ET Jan 11, 2007 LONDON (MarketWatch) -- The Bank of England on Thursday surprised the market with a 0.25% increase in its key interest rate to 5.25%. Economists had widely been expecting the Bank to wait until its inflation report in February to raise rates again. The rise follows recent strong growth in the services sector and a buoyant housing market. Inflation also recently rose to 2.7%, well above the Bank's 2% target rate.