Interest rates LIVE: Bank of England poised to cut base rate by 0.25% | Personal Finance | Finance

With the UK’s growth forecasts for 2025 downgraded to just 1%, there is growing pressure on the Bank of England to reduce interest rates in a bid to stimulate the economy.

However, while a rate cut might be on the horizon, experts warn that such a move may not provide the immediate relief some expect.

Alistair Douglas, CEO of TotallyMoney, said: “With UK growth forecasts downgraded to just 1% in 2025, the Government will be doing anything and everything in its power to get the economy on track. And that probably means that Rachel Reeves has been frantically phoning her ex-colleagues at the Bank of England to see if they can swing a rate cut this week. However, that alone is unlikely to have a seismic impact on consumer finances, with mortgage lenders already factoring cuts into their pricing, and banks slashing savings rates.”

He continued: “The good news is that the Chancellor is exploring longer-term solutions, including a £78 billion Oxford-Cambridge Growth Corridor, a new Heathrow runway, and a £20million investment in rocket-maker, Orbex. But the truth is that these big projects take time to launch, and to make an impact.”

Mr Douglas added: “In the meantime, businesses and employees will be feeling the pinch from employers’ National Insurance contribution hikes and frozen personal tax thresholds. And over the next few months, everything from energy and water, to phone and broadband bills will increase, while the government has also given the green light to council tax hikes of up to 10%.

“A more balanced approach would help the economy in the short-term, and give people more confidence in the government and its ability to turn things around.”