Bank Of England Cuts Interest Rate As Inflation Slows

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.

As widely expected, the BoE trimmed borrowing costs by 25 basis points to 4.75 percent at a regular policy meeting, it is second reduction since August as the Consumer Prices Index in Britain stands at 1.7 percent, the lowest level since 2021 and below the two-percent target.

Recall that Major central banks started this year to cut interest rates that had been hiked in efforts to tame inflation, which soared following the end of Covid lockdowns and Russia’s invasion of Ukraine.

Sweden’s central bank slashed borrowing costs by 0.5 basis points today, its fourth this year and biggest reduction in a decade while Norway made no change.

The Fed is later expected to trim by 25 basis points in a decision unlikely to have been influenced by Donald Trump’s return to power, according to analysts.