Prime lending rate moves up to 17.25%

Chase Manhattan and First National Bank of Chicago raised their prime lending rates Tuesday by one-half of a percentage point to a record 17.25 percent, a move that is likely to be followed by other major banks.

Prime lending rates, the amount that banks charge to lend money to their best customers, have risen 2 percent in the past 2 1/2 weeks as a result of recent government moves to control inflation.

Tuesday's hike sent stock prices plunging in fairly active trading.