The problem with interest rates
Is they are a blunt instrument unsuited to the current problems the economy faces.
Prices are not high due to general demand, they are high due to the cost of supply., especially, fuel and commodoties.
Suppressing peoples ability to buy fuel and food wont bring down price inflation as the inflationary pressure is outside our control.
What an interest rate rise will do is give impetus to the banks to massively raise interest rates, especially on unsecured debts like credit cards and overdrafts. A 0.25% rate rise from the Bank of England will trigger rises across those markets of between 3 and 5%!
The current oil price is speculator driven, supply hasnt diminished, but the futures market is using political instability to drive prices despite the oil producers like Saudi taking up the slack from Libyan output.
But the issue with oil is a red herring as well, the goverment has driven inflation with a VAT rise and fuel duty increases and thats just on fuel, the overall VAT rise has pushed prices across the board as well, making the average mortgage more expensive wont bring down prices when the two factors affecting the price (commodites and taxes) wont be impacted.