Bank of England set for second cut after Labour reveals tax-hiking budget
CNBCNov 04, 2024
The Bank of England (BoE) has cut interests rates to 4.75% – down 0.25 points from 5%. This is the second interest rate cut by the BoE this year.
The BoE's monetary report summary states the decision, which was passed in an 8-1 vote by the Monetary Policy Committee (MPC), was based upon "continued progress in disinflation" – citing in particular "abated" external shocks.
In August, the BoE began cutting interest rates from a 16-year high of 5.25%, having risen 14 consecutive times between Mar. 2020 and Dec. 2021 as inflation hit a peak of 11.1% in Oct. 2022.
The BoE's decision to cut interest rates after last week's budget is a sign of confidence in Rachel Reeves's pro-growth economic plan. Whilst some will inevitably complain, and it is a well-known fact that the UK economy is in need of substantial overhaul, the Labour Government has taken the first steps in leading the country back in the right direction and will only benefit from another interest rate cut.