5th February 2012
Bank cuts interest rates to 5.25%
7th Feb 2008
The Bank of England's rate-setting committee has cut interest rates to 5.25% from 5.5% amid signs that the UK economy is slowing down.
Analysts had widely predicted the move, which followed recent cuts in the US, where the Federal Reserve has slashed its borrowing costs to 3% from 4.25%.
However, the Bank of England signalled it was unlikely to be as aggressive because of fears over rising prices.
The Bank said it needed to ensure that growth and inflation were balanced.
The employers' organisation the CBI welcomed Thursday's rate cut and said it was pleased there had not been a bigger reduction. "It is clear that it is a delicate balance with inflation pressures," said the CBI's Ian McCafferty.
"A quarter point now and then watching very carefully for how inflation develops in the coming months is the best strategy."
But the British Chambers of Commerce disagreed.
"Threats to growth are much more acute now than risks of higher inflation, and we would have welcomed a bold UK move to 5% today," said its economic adviser David Kern.
Trade union umbrella body the TUC also welcomed the decision.
"Homeowners will be pleased at the prospect of lower mortgage payments and UK manufacturers will look forward to paying less when they want to borrow to invest," said TUC head of economic and social affairs Adam Lent.
