The ousted Catalan Leader, Carles Puigdemont, is facing a spanish arrest warrant as eight former colleagues are detained in the wake of the disputed independence referendum. And the most endangered ape in the world, a new species of orang utan, is discovered in indonesia. Its 5 oclock. Our main story is that the bank of england has announced the first rise in Interest Rates for more than a decade, in order to curb the rate of inflation. Members of the Banks Monetary Policy Committee voted by seven to two to raise the official bank rate, from a quarter to a half of 1 . And there could be more rises to come in the months ahead. The decision will mean higher Monthly Payments for millions of households with variable Rate Mortgages. But the banks governor mark carney said households across the uk are generally well positioned to deal with the rate increase, as our economics correspondent andy verity reports. The bank of england may look exactly as it did the last time Interest Rates rose, but the economy doesnt. In the ten years since the peak year of the housing and credit bubble, the amount we produce and earn has barely grown and that means we are more vulnerable to inflation. There it is, 0. 5 . With unemployment at a 42 year low, inflation running above target and growthjust above its new lower speed limit, the time has come to ease our foot a little off the accelerator. Margy and her husband live in streatham in south london. Soon after buying their house, the Interest Rate on the mortgage hit 15 . When rates dropped in the noughties, she took an advantage to repay more than she had to. She is now paying less than 2 and can easily cope with the rate rise. Money has been cheap for a long time and im very aware it could be going up for a long time. In fact, theyve been threatening for a couple of years. Im surprised its taken this long for them to do it. Paying off while it is cheaper means i have less to pay off now. After last hitting a peak before the 2008 crisis, Interest Rates dropped to what was then a record low and stayed there for seven years, only to drop again in the wake of the brexit vote. All theyve done is taken back the quarter point cut they made last august after the brexit referendum when they were worried confidence might falter and spending might go down. So thats all theyve done. Theyve taken their foot off the accelerator in terms of Monetary Policy but not much more than that. That prolonged period of ultralow Interest Rates may have helped keep the economy out of worse trouble but its also have damaging effects, not just on savers. If you keep money ultra cheap, you encourage people to borrow more to buy assets like houses and that has pushed the prices of houses beyond the reach of many young people who would like to be able to afford their own home. While higher Interest Rates should make it more attractive to hold pounds, traders focused on warnings the next rise would not come soon. About half the countrys families now on their own homes and only a minority of them have the mortgage. The bank of england is confident now inflation hit its peak last month and families will be able to cope with higher Interest Rate. Andy verity, bbc news. So, just to underline. While the increase is good news for savers, it means millions of variable Rate Mortgage holders will see their Monthly Payment rise. Our Business Correspondent theo leggett has been looking at the potential impact on homeowners. When Interest Rates rise, millions of homeowners are affected but not everyone will feel the impact straightaway. 46 of people with mortgages are on some form of variable rate. They will bear the brunt of the increase. The 54 on fixed rate deals wont see their costs go up straightaway, but they will do eventually when the fix comes to an end. An increase of a quarter of a percent were about £15 per month to a typical £125,000 variable Rate Mortgage. 0r or £185 0r £185 a year. That might not sound like much, but for some homeowners it can make a huge difference. People like lynn, the owner of this house. She struggled financially since a car accident stopped her from working. Im literally living. I wouldnt say on the breadline but very close and any hike in interest or supermarket bills affects me instantly. But other homeowners can afford to be more pragmatic. I have children and a mortgage already, if they do go up and i would be concerned. At the moment its a case of getting a deposit, and more on your savings will help us out of it. While the rise may be bad news for some homeowners who will pay more on their mortgages, its good news for savers, who stand to get a better return from their investments. According to some analysts, this may be the first of several rate rises. Whether you are a saver or a borrower, i dont think the increase will be that significant now. But the likelihood is we will get a series of increases, maybe two or three over the next two or three years so it will start to have an impact on our everyday lives. After ten years without any Interest Rate rises, todays decision by the bank of england is highly symbolic. But the size and speed of future increases are what will be preoccu pying both borrowers and savers for months to come. Well, our economics editor kamal ahmed has been speaking to the governor of the bank of england , mark carney. He asked him if it really was the right time for an Interest Rate rise. Lets be clear what we announced today. Effectively, what the bank has decided is to take our foot a little off the accelerator. The economy is growing a little faster than its speed limit. That speed limit has come down over the years since the crisis for a variety of reasons. Weve got unemployment at a 42 year low, more people in work than ever before. Were seeing the first signs of wages starting to pick up. But most importantly for those watching, that real income squeeze which has been hitting households over the course of this year, the worst is ending, its starting to turn now. And what we want is for inflation to get back from it high level now, 3 , may be going a little higher, we think, next month, and bring it back to that 2 target, ourjob, because that our contribution to not just making sure we get out of that real income squeeze, but that we stay out of it. Lots of people watching this will be wondering, what is the future path of Interest Rates. Is this the start of regular Interest Rate rises . We have emphasised on that for a number of years that in the event which has happened today that we started to raise Interest Rates, that the path would be very gradual relative to history and to a limited extent, and i can be a little more specific about that, which is the forecast we put out today, which has after all the economy growing at around 1. 7, 1. 75 for the next few years, more or less, so good, not the historic rate, but good. Consistent with our mandate and consistent with supporting the economy, that requires about two more Interest Rate increases over the next three years. So its something, but its certainly nothing compared to historic rate cycles. I am duty bound to say, though, of course, we will do whats necessary in order to meet the remit as the situation changes. And the one thing we know is that in some way, the situation will change. That was mark carney, the governor of the bank of england. Professor David Blanchflower was a member of the bank of englands Monetary Policy committee between 2006 and 2009 , and is now professor of economics at dartmouth college. He joins me on webcam from florida. Your Immediate Response to this strategy today . Big mistake. The markets didnt buy it, the pound had arisen on expectations of this rate rise coming. As soon as they saw the evidence and listen to what mark carney said, the pound plunged back to where it was before they made this announcement. This is what i call guessonomics, there is nothing in the data to suggest it. He said that wage goes is picking up, and that wage goes is picking up, and thatis that wage goes is picking up, and that is completely not true. Retail sales are falling. The uk is the slowest growing economy in europe. So basically what this will do for people who are struggling, it will actually raise the cost of doing business, if you like. And it doesnt just hurt business, if you like. And it doesntjust hurt homeowners. It raises the cost of borrowing to firms, and it lowers dividends. So i have every expectation this will be like the last rate rise done in 2007 which i voted against which pushed the uk into recession. My suspicion is that this will be reversed. It is a major mistake. Despite what mark carney said, there is nothing in the data to sustain this, and it looks to bea data to sustain this, and it looks to be a huge mistake. All of it really centring around the inflation figures, and the bank explaining that it does have certain statutory duties in that area, of course it does. So do you think that that is something they should just cast aside . I dont mean that at all. The argument the mpc has to do is look at what inflationary is going to be in the future, and basically what they showed and the data show is this sharp increase in inflation that weve seen was driven by a once off cropping the exchange rate, so their forecast is inflation is just going to drop away, so raising rates is just not necessary, because inflation is going to go back to target on its own. And if you look at the rest of the world, inflation is well below target, so the argument that you need to do this to solve inflation is untrue. Remember in 2008 we had the same argument, inflation was 5 , and that was an argument why we shouldnt deal with the fact that uk had gone into recession. So inflation is an issue, but essentially this shock that we haveis but essentially this shock that we have is about to disappear. But why would the bank take a measure which according to your analysis is going to lead to exacerbating the problems that are already there . Well, i think its probably absolute incompetence. We saw that in 2007. We have seen it in the European Central bank a couple of times in 2011. We see it at the swedish central bank. The argument here is literally, there is no data to support this. So this is just sort of made up as you go along. Carney made a statement sometime ago to say that he thought it was appropriate to raise rates, so he kind of boxed itself into a corner, and ever body expected him do it, and theyve done it, but it looks to huge error. So you would have to ask them, but the reality is that you have to look at what the Market Reaction is, and you normally expect, raise rates, see the pound rise. What you have seen in the last two hours, the pound has plummeted, consistent with what i say, the markets dont buy it, and i think what youre going to see is the next move is not what carney said he would do, he is going to have to reverse this, lower Interest Rates because this is a major error. How soon, do you think, if you are right about this, these effects will start to be evident . Six months or so, 6 9 months we will start to see the impact, maybe sooner, but i would suspect we would see a rate cut sometime in the winter or spring of next year. The question is, what is going to happen wage growth . Carney says that wages are growing. If you go to the 0ns and look at all the data, wage growth is slowing, evenin the data, wage growth is slowing, even in the report, the Inflation Report they produce today, the banks agents show wage growth is slowing. The 0ns shows that it is slowing. The 0ns shows that it is slowing. So we will be looking at the data, but the government of the central bank cant go insane wages are rising when wages are actually falling. The credibility of the central bank is clearly in question when it makes stuff up. Professor David Blanchflower, good of you to join us, thank you very much. Former member of the bank of englands Monetary Policy there, speaking as an webcam from florida. You are watching bbc news. These other headlines the bank of england raises Interest Rates , for the first time in a decade. Its part of the banks fight against inflation , and there could be more to come. At westminster, the new defence secretary is Gavin Williamson , who used to be the conservative chief whip , some of his colleagues are not happy with the appointment. The ousted Catalan LeaderCarles Puigdemont is facing a spanish arrest warrant as eight former colleagues are detained , in the wake of the disputed independence referendum. In sport, england manager Gareth Southgate includes three uncapped players in his squad for the upcoming friendlies with germany and brazil. Swansea striker Tammy Abraham is in, as is ruben loftus cheek of Crystal Palace. Liverpools joe gomez loftus cheek of Crystal Palace. Liverpoolsjoe gomez is the third. England have been handed a favourable draw in the opening matches of the 2019 Rugby World Cup, they open against tonga and the united states. Ajones says they will have no excuses if theyd win. And england batsmen Mark Stoneman says he hopes ben stokes borstal feature in the forthcoming series. The influential all rounder has not been selected after his arrest back in september. I will be back with more on all those stories that have passed. At westminster, Gavin Williamson is the new defence secretary. Sir Michael Fallon stood down last night, saying his conduct had fallen short of the required standards , after allegations of inappropriate behaviour. Sir michael is the first politician to resign following recent claims of Sexual Harassment at westminster. 0ur Political Correspondent iain watson reports. The man on the right is usually responsible for defending theresa may, especially from critics on her own side. Now Gavin Williamsons job is to defend the nation. Until this morning he was the chief whip, his task to keep tory mps in line and keep the Prime Minister in office. The Prime Ministers chief whip was swiftly replaced by this man, his deputyjulian smith. Theresa may wanted to avoid a wide ranging reshuffle but the question now is whether the rapid departure of the previous occupant of the ministry of defence might in turn lead to further resignations. Ive spoken to people today at westminster who are convinced other stories of sir Michael Fallons asked if you could emerge and it was his inability to guarantee there would be no further revelations that seems to have ended his career, but are there other ministers who may have done something in the past that will be judged unacceptable today . And would that put them in the firing line . People need to recognise there is now a very strong set of rules about this kind of behaviour, that we shouldnt pass it by and say that is a one off. That has changed. I dont think necessarily you will see lots of ministers resign. The vast majority of people in parliament do not get up to this stuff. But the leader of the scottish conservatives appear to favour cleaning out the stables. We have seen bullying allegations between members of staff, allegations of sexual impropriety between elected members and others, and this is all about power. It is about people who are higherup about power. It is about people who are higher up the tree is that in power on people who are lower down the tree, junior members of staff, activists, volunteers. That is not acceptable. This is not about clearing out stables. I regret Michael Fallons decision. We need to create an environment where everybody is treated with respect, women are treated with respect, women are treated with respect, that is the right and proper thing. Treated with respect, that is the right and properthing. But treated with respect, that is the right and proper thing. But the government has a big task ahead with brexit and that has to be our priority. Business as usual is the image the Prime Minister wanted to portray when she met her israeli counterpart at lunchtime. The problems may be leicester matic crnic those of the middle east, but removing at moving ministers has made herjob at number ten macro any easier. Ian watson, bbc news, westminster. 0ur chief Political Correspondent vicki young is in westminster. How has this been received . How has this been received7m how has this been received . It was ha rd to how has this been received . It was hard to find anybody who thought it was a good decision, a lot of people said they were speechless, that it was a big surprise, and others were off camera much ruder. They feel the Gavin Williamson is the chief whip, it is normally a role where you are involved in the appointment of people, and some have said he has just appointed himself, and it shows theresa may is weak and she roared those who are cl