The Bank of England looks set to cut interest rates on Thursday for only the third time since just after the start of the COVID-19 pandemic in 2020, as it juggles the need to help the sluggish economy with still-strong inflation pressures.

Interest rates are expected to be cut by the Bank of England later, in a move closely watched by households and economists. Analysts predict the benchmark rate will be cut from 4.75% to 4.5%, as the Bank comes under pressures to boost the UK economy which has been showing slow growth.

Experts are predicting a rate cut to 4.5% – but signs of rising inflation leave the Bank walking ‘a tightrope’ for future reductions this year.

The Bank of England must contend with a slowdown in Britain's economy but also stubborn inflation pressures when it considers whether to cut interest rates in early February as well as its message about the outlook for the rest of the year.