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The Bank of England (BoE) has lowered its interest rates by 0.25%, bringing the benchmark rate from 5.25% to 5.0%. This is the first rate cut since the start of COVID-19 in March 2020 and the decision was reached through a close vote in a 5-4 margin. 
During the <a href="https://www.msn.com/en-us/money/markets/bank-of-england-cuts-rates-from-16-year-high-will-be-careful-on-next-moves/ar-BB1r1PjK?ocid=BingNewsSerp" target="_blank" data-type="link" data-id="https://www.msn.com/en-us/money/markets/bank-of-england-cuts-rates-from-16-year-high-will-be-careful-on-next-moves/ar-BB1r1PjK?ocid=BingNewsSerp" rel="noreferrer noopener nofollow">press release</a>, BOE’s Governor, Andrew Bailey emphasized the importance of maintaining a low and stable inflation and cautioned against rapid or excessive rate cuts.&nbsp; 
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow"> 
 “While we’ve managed to cut interest rates today, We need to make sure make sure inflation stays low, and be careful not to cut interest rates too quickly or by too much,” <cite>Andrew Bailey Stated</cite>
</blockquote> 
This report comes after the US Federal Reserve decided not to change its interest rates which were pegged at 5.25%. But Jerome Powell, the Chairman of the Federal Reserve <a href="https://www.cryptotimes.io/2024/08/01/interest-rate-cut-could-be-possible-in-september-fed-chair-jerome-powell/#:~:text=During%20a%20recent%20press%20release%2C%20Fed%20Chair%20Jerome%20Powell%20hinted%20while%20the%20Fed%20is%20keeping%20the%20current%20rate%20for%20now%2C%20a%20rate%20cut%20might%20be%20possible%20in%20September%20if%20the%20economic%20data%20shows%20it%E2%80%99s%20needed.%20This%20potential%20rate%20cut%20might%20also%20impact%20the%20demand%20for%20digital%20assets." target="_blank" data-type="link" data-id="https://www.cryptotimes.io/2024/08/01/interest-rate-cut-could-be-possible-in-september-fed-chair-jerome-powell/#:~:text=During%20a%20recent%20press%20release%2C%20Fed%20Chair%20Jerome%20Powell%20hinted%20while%20the%20Fed%20is%20keeping%20the%20current%20rate%20for%20now%2C%20a%20rate%20cut%20might%20be%20possible%20in%20September%20if%20the%20economic%20data%20shows%20it%E2%80%99s%20needed.%20This%20potential%20rate%20cut%20might%20also%20impact%20the%20demand%20for%20digital%20assets." rel="noreferrer noopener">hinted at a possible rate cut in September</a> thereby indicating that other central banks may follow suit 
In contrast to this, Japan’s Central Bank has raised its interest rates due to the weakening Japanese Yen while central banks from Canada and other countries had already slashed their own rates earlier this year 
The decision made by BoE will contribute towards assisting the UK’s economic growth hence benefiting sectors such as real estate and homebuilding, as shown by the rise in the FTSE indices after the announcement. 
Following the report the British Pound dropped against the US dollar hitting its lowest level since early July and bond yields fell alongside it as well with the 10-year gilt yield reaching its lowest point since March 
<figure class="wp-block-image">
 <img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfrpoNCbvdHRXKsnJJ6NvQrlz1uLw9PfYul6QRYZfgz1Ra6KXT-HNv_on6PJeoTORc_qJwUMRTOJyN-7lFURY6vMa1M8T2PtOZkz47xn5nV3e5emSjSPoSczF5_Wi2P4Cqf2QwQAhSKUhsN_Nwsv18yVNA?key=6CyluVGfGC-dQ1jKDApjYA" alt="AD 4nXfrpoNCbvdHRXKsnJJ6NvQrlz1uLw9PfYul6QRYZfgz1Ra6KXT HNv on6PJeoTORc qJwUMRTOJyN 7lFURY6vMa1M8T2PtOZkz47xn5nV3e5emSjSPoSczF5 Wi2P4Cqf2QwQAhSKUhsN Nwsv18yVNA?key=6CyluVGfGC dQ1jKDApjYA">
 <figcaption class="wp-element-caption">
 GBP/USD 1hr timeframe indicating that GBP saw a significant decline in price against USD | Source: <a href="https://www.tradingview.com/chart/WqDncXIe/?symbol=FX%3AGBPUSD" target="_blank" rel="noreferrer noopener nofollow">TradingView</a>
 </figcaption>
</figure> 
Both crypto and traditional investors are now looking forward to seeing if BoE will make more cuts as reports like this can affect their portfolios. While, there are no immediate cuts promised it is likely that before the end of this year, there might be one more cut with a 55% probability in September’s next meeting. 
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow"> 
 Also Read: <a href="https://www.cryptotimes.io/2024/08/01/bis-bank-of-england-introduces-project-pyxtrial-to-monitor-stablecoin/" target="_blank" rel="noreferrer noopener">BIS, Bank of England Introduces Project Pyxtrial to monitor Stablecoin</a> 
</blockquote>

Bank of England Cuts Interest Rates From 5.25% to 5.0%

The Crypto Times

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