This week the Bank of England (BoE) has reduced interest rates by a quarter, bringing the base rate down to 4%. This marks the third cut of the year and the fifth since August 2024, lowering borrowing costs to their lowest level since March 2023. In a narrow 5–4 vote, the Bank’s Monetary Policy Committee decided to proceed with the cut. The BoE now expects inflation to peak at 4% in September. The BoE’s governor, Andrew Bailey commented on the decision, stating: “We’ve cut interest rates today, but it was a finely balanced decision. Interest rates are still on a downward path, but any future rate cuts will need to be made gradually and carefully.” Meanwhile, the Chancellor Rachel Reeves MP welcomed the cut, noting that it will provide some relief for borrowers facing financial strain. Sue Robinson, Chief Executive of the National Franchised Dealers Association (NFDA), representing car and commercial retailers across the UK commented: “NFDA welcomes this decision as it will continue to help ease pressure on both consumers and dealers.” The BoE also revised its economic outlook, forecasting a sharp slowdown in GDP growth to just 0.1% for the April-to-June quarter. The official figures are expected to be released next week.