BANK OF ENGLAND REDUCES INTEREST RATES BY 0.5% TO 5.5%

The Bank of England's Monetary Policy Committee last week voted to reduce the Bank's repo rate by 0.5% to 5.5%.

Taking account, in particular, of the prospects for international activity and prices, domestic costs and consumer demand, the Committee's latest inflation projections implied that a further reduction in interest rates was necessary to keep inflation on a path consistent with the target of 2 ½%. The latest projections and analysis will appear in the Inflation Report to be published on Wednesday 10 February.

The minutes of the meeting will be published at 9.30am on Wednesday 17 February.

The previous change in interest rates was a reduction of 0.25% to 6.0% on 7 January 1999.