Chancellor Rachel Reeves welcomes the cut, but says she is "under no illusion about the scale of the challenge facing households".

The central bank said future cuts would be gradual amid higher inflation forecasts after the new government introduced spending and tax increases in its budget.

The Bank of England has cut its main interest rate by a quarter of a percentage point after inflation across the U.K. fell below its target rate of 2%

The outcome of the Monetary Policy Committee meeting was announced at midday today. Stay up to date with live reporting and analysis from the team at MoneyWeek.

Barclays expects the Bank of England to hold interest rates at its December meeting, revising its prior forecast of a cut, citing the central bank's cautious tone that emphasized uncertainty and gradual policy moves.

Interest rates are widely expected to be cut by the Bank of England on Thursday, in a move closely watched by businesses and consumers.Most analysts predict that the benchmark rate will fall from its current level of 5% to 4.

The Bank of England cut interest rates but pointed to the uncertainty facing the global economy from fresh trade barriers and Middle East conflict

The Bank of England on Thursday said it was cutting its key interest further after UK inflation hit a three-year low and signalled more reductions, easing pressure on borrowers.

MORTGAGE lenders have raced to slash their rates after the Bank of England cut interest rates to 4.75% this afternoon. This move will immediately benefit thousands of mortgage customers with

The Bank of England has cut interest rates to 4.75 per cent after inflation fell to a three-year low in September. The eight-to-one decision to cut the base rate by 0.25 percentage points was in line with the expectations of economists polled by Reuters.