The monetary policy committee voted to cut cost of borrowing again today to a new record low after hearing fresh evidence that the UK economy is in poor shape.
The decision will disappoint those in the City who had had hoped for a full percentage point cut.
It will be welcomed by borrowers and homeowners, coming just hours after the unexpected news that house prices rose by 1.9% in January. The latest data fom the Halifax put an end to months of falls and took many commentators by surprise.
If lenders pass the reduction on in full to borrowers, people with mortgages that track a point below base rate will find themselves paying no interest.
But the decision spells further gloom for savers as savings rates fall to virtually zero.