Interest rates 'cut to 2%'

Self builders who have taken out a base-rate tracker mortgage may be happy to learn that the Bank of England's Monetary Policy Committee (MPC) has voted to cut interest rates again.

Today the MPC voted for a cut of one percentage point on the benchmark rate to two per cent, which it hopes will stave off a prolonged recession.

The rate cut comes a month after the MPC announced a surprise 1.5 percentage points reduction.

Last week, Mervyn King said the committee will take "whatever action" is required to help guide the Uk's economy back into "calmer waters".

Consequently, as a "substantial risk" of falling short of the two per cent consumer price index inflation target in the medium term remains, the MPC has decided to cut interest rates to their lowest point since 1951.

The MPC suggested it was "unlikely" that a normal volume of lending would be restored without further measures.