Proactive investorsLogo Proactive Investors UK Website

Search field
Additional information
Additional Information
Market: .
Sector: General Financial
Epic: B of E
News: Latest news
Web Site: Bank of England
Other Articles: 07-05-200909-04-200905-03-2009

Bank of England

The Bank of England is the central bank of the United Kingdom. Sometimes known as the 'Old Lady' of Threadneedle Street, the Bank was founded in 1694, nationalised on 1 March 1946, and gained independence in 1997.

Standing at the centre of the UK's financial system, the Bank is committed to promoting and maintaining monetary and financial stability as its contribution to a healthy economy.

Thursday, January 08, 2009

Bank of England cuts interest rate to historic low of 1.5%

company news image

The Bank of England’s Monetary Policy Committee today voted to reduce the official rate paid on commercial bank reserves by 0.5 percentage point to 1.5 percent, the first time the rate fell below 2 percent in the institution’s 315-year history.


In a statement, the BoE said business surveys in the UK suggest that the pace of contraction in activity increased during the fourth quarter of 2008 and that output is likely to continue to fall sharply during the first part of this year. Surveys of retailers and reports from its regional agents imply that consumer spending has weakened. The outlook for business and residential investment has deteriorated.


The world economy appears to be undergoing an unusually sharp and synchronised downturn, and world trade growth this year is likely to be the weakest for some considerable time, it added.


CPI inflation fell to 4.1 percent in November. Inflation is expected to fall further, reflecting waning contributions from retail energy and food prices and the direct impact of the temporary reduction in Value Added Tax.


The MPC judged that, looking through the volatility in inflation associated with the movements in VAT, there remained a significant risk of undershooting the 2 percent CPI inflation target in the medium term at the existing rate level. Accordingly, the MPC concluded that a further reduction of 0.5 percentage pointto 1.5 percent was necessary to meet the target in the medium term.

NewsNow icon AddThis Feed Button
Register here to be notified of future Bank of England articles.

Other Bank of England news

More news ►

Investors interested in Bank of England recently viewed


No investment advice

The Company is a publisher and is not registered with or authorised by the Financial Services Authority (FSA). You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.