Key Points:

British interest rates hit a 6-year high of 5.5 per cent yesterday and economists predict they will rise further still as the Bank of England tries to rein in inflation, at its highest level in more than a decade.

The bank's quarter percentage point increase, which followed the US Federal Reserve's decision on Wednesday to leave its rates at 5.25 per cent, means borrowing costs in Britain are the highest in the G-7 rich countries' club.