Bank of England cuts UK interest rate to record low

08 January 2009 12:01  [Source: ICIS news]

LONDON (ICIS news)--The Bank of England on Thursday cut UK interest rates by a half a percentage point to 1.5%, the lowest in the bank’s 315-year history.

The bank has now cut its basic rate three and a half percentage points since the beginning of October in an attempt to prevent a prolonged recession amid deteriorating global economic conditions.

Previous cuts have failed to revive domestic business, with recent data from the UK’s manufacturing and services sectors showing activity levels close record lows.

Chancellor Alistair Darling on Tuesday admitted the recession had been deeper than the government expected.

The Treasury talked down newspaper speculation that it was considering injecting more money into the economy as interest rates fall close to zero, but said it hadn’t ruled out such a move in the future.

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Author: Mark Watts
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