Bank of England cuts key policy rate to lowest level in more than two years
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The Bank of England has cut its key policy rate by 0.25 percentage points to 4%, the lowest level in more than two years. About reported Bank of England and wrote Bloomberg.

The decision was made by a majority vote of the Monetary Policy Committee (five to four).

This is the fifth cut in a row, and the Bank of England has now outpaced the US Federal Reserve, which cut the rate last year, in terms of monetary policy easing.

Despite the new surge in inflation, the Bank of England is trying to support the economy, which is facing a number of challenges.

In recent months, the country has been experiencing a slowdown in growth and labor market problems following the increase in employer taxes.

Since April, when the government raised insurance premiums and the minimum wage, more than 180,000 jobs have been cut in Britain. The unemployment rate has risen to its highest level since 2021.

Nevertheless, inflation was higher than expected. In June, prices rose by 3.6%, although the Bank of England had expected 3.4%. In the new forecast, which was released along with the rate decision, the Bank of England acknowledged that price growth could reach 4% this year.

In addition to the rate, markets are expecting updates on the Bank of England's plans for the so-called "quantitative easing" – a program to sell government bonds that were previously bought back to the balance sheet.

Currently, the country's bank sells about 100 billion pounds worth of securities a year, but this pace is expected to slow down due to instability in the long-term debt market.