Bank of England cuts interest rate as inflation slows

The Bank of England (BoE) on Thursday said it was cutting its key interest further after UK inflation hit a three-year low and signaled more reductions, easing pressure on borrowers. The BoE said a maiden budget last week from Britain's new Labour government, featuring tax rises and increased borrowing, would boost growth but also lift inflation.

As widely expected, the BoE trimmed borrowing costs by 25 basis points to 4.75 percent at a regular policy meeting, its second cut since August. The Federal Reserve is set to follow suit with US rates later in the day as inflation cools globally. The Consumer Prices Index in Britain stands at 1.7 percent, the lowest level since 2021 and below the two-percent target.