The Bank of England Monetary Policy Committee has announced this lunchtime that the bank's interest rate is to be cut by a quarter point from 4.75% to 4.5%

Responding to the Bank of England's decision to cut interest rates, TUC General Secretary, John Monks, said, "Today's decision is very welcome but the Bank must be ready to act again.

"Our immediate economic future is uncertain – this rate cut will help companies to take the long term view, hold their nerve and weather the storm. Shedding skilled staff will make it tougher for firms to bounce back and will ultimately do us more damage in the long term."

In the Confederation of British Industry (CBI) Ian McCafferty, Chief Economic Adviser, said, "The Bank has made the right decision. Even before September 11 survey evidence suggested that the economy was weakening. Since the tragedy we have seen the deterioration in trading conditions in the US and elsewhere in Europe, coupled with job cuts in the UK. Together these will keep the lid firmly on inflation."