ANKARA

The Bank of England (BoE) on Thursday cut its benchmark rate by 25 basis points to 4.50%, in line with the market forecasts.

With the third rate cut since the bank began reducing borrowing costs last August, the rate hit its lowest level since June 2023.

"In support of returning inflation sustainably to the 2% target, the Committee judges that there has been sufficient progress on disinflation in domestic prices and wages to reduce Bank Rate to 4.5% at this meeting," said a BoE statement.

As inflation continued to decrease, seven of the Monetary Policy Committee's nine members backed the quarter-point rate cut, while two voted to cut the rate by half a point to 4.25%, the statement said.

The annual consumer inflation rate in the UK ticked down to 2.5% in December from 2.6% in November, exceeding the bank's target of 2%.