The Bank of England on Thursday increased interest rates by 0.15 percentage points, to 0.25%, for the first time in more than three years, a bank statement said.

The Monetary Policy Committee voted 8-1 in favor of the increase from a record low of 0.1%.

Citing concerns over the new Omicron variant of the coronavirus, the bank said "additional measures will push down on GDP in December and in 2022 Q1."

The bank also said upward pressure on inflation is expected to dissipate over time, as supply disruption eases, global demand rebalances from goods to services, and energy prices stops rising.

"Inflation was projected to fall back materially from the second half of next year," it added.

The bank will also continue the stock of UK government bond purchases, financed by the issuance of central bank reserves, at £875 billion ($1.16 trillion), and so the total target stock of asset purchases at £895 billion," it said./aa