Bank of England Cuts Interest Rates to 4.75%

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Nov 07, 2024

Above: The Bank of England holds the central bank's Monetary Policy Report press conference Nov. 7, 2024. Image copyright: Henry Nicholls/WPA Pool via Getty Imagesstory last updated Nov 08, 2024

The Facts

The Bank of England (BoE) cut interest rates to 4.75% Thursday — a 0.25 decrease. This is the second interest rate cut by the BoE this year.
The BoE's monetary report summary said this cut, which passed by an 8-1 vote by the Monetary Policy Committee (MPC), was based upon "continued progress in disinflation" — citing, in particular, "abated" external shocks.
The BoE began cutting interest rates from a 16-year high of 5.25% in August. The rates had risen 14 consecutive times between March 2020 and December 2021, as inflation hit a peak of 11.1% in October 2022.

The Spin

Left narrative

This decision shows confidence in Chancellor of the Exchequer Rachel Reeves's pro-growth economic plan. While some will inevitably complain, and the UK economy is in dire need of a substantial overhaul, the Labour government has taken its first steps in leading the country back in the right direction and will only benefit from another interest rate cut.

Guardian

Right narrative

The BoE's analysis is clear: progress has been made to reduce inflation, but Reeves's high-cost agenda is at risk of undoing the hard work of the last two years. Given Labour's spending obsession, it is likely that Bailey and the BoE will have to slow down interest rate cuts even further, placing greater financial pain on millions of homeowners and working people.

The Telegraph