The central bank said that future cuts would be gradual amid higher inflation forecasts after the new government introduced spending and tax increases in its budget.

The Bank of England cut interest rates on Thursday for only the second time since 2020 and said future reductions were likely to be gradual as it predicted the British government's first budget would lead to higher inflation and economic growth.

BoE says the higher bus fare cap and adding VAT to private school fees will push up UK inflation.   20:04 Q: Did you learn anything about what the Americans think about the economy from the election result?