MPC votes for new quarter-point cut but downgrades economic outlook and predicts inflation will rise to 3.7% by autumn

The Bank of England has cut interest rates to 4.5%, but warned UK households face renewed pressure from rising prices and a sluggish economy as it halved its growth forecasts for the year.

With the government under pressure amid the fallout from Labour’s budget and Donald Trump’s trade wars, the Bank’s monetary policy committee (MPC) voted by a majority of seven to two to reduce its key base rate down from 4.75% to ease some of the financial pressure on borrowers.