Bank of England cuts interest rate again

The Bank of England has made a 0.25% cut to the interest rate in a boost to first-time house buyers and a show of confidence in the UK economy.

The new rate of 4.75% comes after market jitters were allayed following last week’s controversial Budget by new Chancellor Rachel Reeves.

The Bank’s Monetary Policy Committee voted 8-1 to cut the rate.

It is the second drop in three months following a cut in August – itself the first in more than four years.

Economists believe more cuts could be around the corner as the Bank attempts to spark growth and investments in the UK economy.

A statement from the Bank of England said: “Inflation is close to the 2% target and we’ve been able to cut interest rates again.

“We need to ensure inflation stays low. So we will not cut rates too quickly or too much.

“If things evolve as expected, it’s likely that interest rates will continue to fall gradually.”

Reeves added: “Today’s interest rate cut will be welcome news for millions of families, but I am under no illusion about the scale of the challenge facing households after the previous Government’s mini-budget.

“This government’s first budget has set out how we are taking the long-term decisions to fix the foundations to deliver change by investing in the NHS and rebuilding Britain, while ensuring working people don’t face higher taxes in their payslips.”