The Bank of England raised its key interest rate by a quarter point on Thursday to the highest since 2008, saying that while inflation has begun to fall and the economy is growing with unemployment low “inflation is still too high”. Six out of nine members of the monetary policy committee voted in favor of the move.

The hike takes the Bank Rate to 5.25 percent and is the 14th straight rise in a campaign of monetary policy tightening to head off the worst bout of inflation in 40 years. While it has come down from a peak of over 11 percent, headline inflation was still running at nearly 8 percent in July, nearly four times the level that the Bank defines as price stability.

It threatens more pain for those with mortgages and tenants who face sharp increases in their rents as landlords try to pass on the increase in the costs of their own loans. Average two-year U.K. mortgage rates are now nearly 7 percent, according to real estate website Rightmove.

The Bank repeated that it remained ready to raise rates further still if inflation pressures prove to be more persistent than currently expected. The risks of that appear finely balanced: U.K. wages are still growing at a rate that the Bank considers ‘unsustainable’, but there is increasingly clear evidence that the effects of last year’s spikes in energy and commodity markets are reversing. Factory gate prices, in particular, have fallen in five of the last seven months and are now effectively flat from a year earlier.

Analysts had been split ahead of the meeting on how much the Bank would raise by, with a slim majority expecting a quarter-point hike and a substantial minority expecting a half-point.

The pound had hit its lowest in over a month earlier Thursday in advance of the announcement, hurt by general risk-aversion in financial markets since Fitch downgraded the U.S.’s credit rating on Tuesday. That has had the effect of pushing up U.S. and global bond yields, making the dollar relatively more attractive in the short term. By 1305 CET, it was at $1.2637, down 0.65 percent on the day. Traders also pared back peak rate expectations to 5.75 percent.