The Bank of England's Monetary Policy Committee has reduced the base rate by 50 basis points, leaving it at 0.5 percent.
Officials at the Bank of England have announced a decision on the base rate, changing it in line with most analysts' predictions.
The Bank's Monetary Policy Committee has lowered the base rate by 50 basis points to 0.5 percent, its lowest-ever value. However, the rate has been at a historic low since January, when it was set to 1.5 percent.
Changing the base rate allows the Bank to influence the economy in a number of ways. For instance, many lenders reflect the Bank's rate cut in their own products, such as mortgages. By lowering the general base rate, mortgages will in theory become cheaper, boosting the property market.
However, the real talking point among commentators will be the other measures the MPC has brought in, such as quantitative easing. The MPC's hand has been forced by the fact that the base rate does not have much lower to go.
Vicky Redwood, an analyst at research firm Capital Economics, described the interest rate decision as a "sideshow this month". Speaking before the decision, she said: "It looks set to be the first time in the MPC's history that it takes a vote on more unconventional policy measures. This could potentially provide far more of a stimulus to the economy than even another 100 basis points cut in interest rates."
