The Bank of England’s November Inflation Report implied that the UK base rate should increase two more times to 1% by 2020.

Expectations for the path of base rate have risen to 0.7% from 0.5% for Q4 2018 and to 0.9% from 0.7% by the end of 2019. The Bank also slightly increased its predictions for GDP growth in the near term, from 1.3% to 1.5% for Q4 2017.

CPI inflation is now expected to stay at around 3% until the end of the year, up from the 2.8% forecast in the August report. Inflation is then predicted to fall to 2.4% by the end of 2018 and reach 2.1% by 2020.

The Bank of England’s Monetary Policy Committee (MPC) increased the bank rate from 0.25% to 0.5% last week, which was the first rise in a decade.

The Committee vote by a majority of 7-2 to raise interest rates, with David Ramsden and Jon Cunliffe voting against.

Citing reasons for the rise in its minutes, the MPC noted that unemployment has fallen to a 42-year low, domestic financial conditions are highly accommodative and consumer confidence has remained resilient.