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Interest rate cut divides Bank committee as UK growth revised upward

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BoE lowers rates to 4.25% amid trade uncertainty and mixed economic signals

THE BANK OF ENGLAND has cut interest rates from 4.5% to 4.25%—the lowest level since May 2023—as it attempts to strike a delicate balance between supporting a fragile recovery and guarding against persistent inflationary risks.

The decision, announced following the Monetary Policy Committee’s latest meeting, was far from unanimous. Out of the nine members, five voted for the 0.25% cut, two favoured a steeper reduction to 4%, and two wanted to keep rates on hold.

“This is an important moment for the UK economy,” said the BBC’s Economics Editor Faisal Islam, noting that rates are now down a full percentage point from their peak last summer. “Further cuts are expected but they will likely be gradual and cautious.”

Interest rates had climbed steadily from late 2021 in response to post-pandemic inflation, peaking at 5.25% in August 2023. Since then, falling inflation and a slowdown in consumer activity have prompted a shift toward easing.

The rate cut aims to make borrowing cheaper, thereby encouraging spending and investment. Mortgage-holders on tracker deals will see immediate savings—around £29 per month on average—but savers are likely to see a dip in returns.

In a fresh economic outlook, the Bank upgraded its growth forecast for 2025 to 1%—up from February’s 0.75% prediction—driven by stronger-than-expected performance in the first quarter. However, the longer-term picture is less rosy: UK growth in 2026 has been revised down to 1.25%, with global growth also forecast to slow due to international trade tensions.

The economic backdrop is being shaped in part by geopolitical uncertainty, including a fresh round of tariffs introduced by US President Donald Trump. Bank governor Andrew Bailey acknowledged the unpredictable global landscape but insisted the UK remains on a “gradual path” of rate easing.

Bailey also welcomed news of a pending UK-US tariff deal, saying it could help reduce uncertainty. However, he confirmed that the Bank had not yet been fully briefed on the agreement’s details.

Mixed reactions

Trade union Unite described the interest rate cut as “long overdue” but called for broader measures to improve living standards. General secretary Sharon Graham said: “This must include a joined-up industrial strategy to tackle energy profiteering, rebuild our industrial base and boost the economy.”

Meanwhile, Nigel Green, CEO of the financial advisory group deVere, warned that the Bank was moving too cautiously. “A half-point cut would have shown the Bank is ready to act decisively,” he said, arguing that the risks of hesitation outweigh the risks of bold action in the current climate.

Chancellor Rachel Reeves struck a more optimistic tone, calling the rate cut “welcome news” for homeowners and businesses, while Shadow Chancellor Mel Stride criticised Labour’s handling of the economy, claiming “interest rates remain high” because of government mismanagement.

Housing market impact

Nathan Emerson, CEO of Propertymark, said the rate cut would be a boost for the housing sector: “With the busier spring and summer months now here, this base rate reduction should attract more buyers and sellers and improve affordability.”

While today’s rate cut is not a silver bullet, it marks a further step in what may become a sustained effort to ease financial pressure on UK households and stimulate economic activity amid a shifting global landscape.

 

Business

Glass theft warning as pubs prepare for busy summer

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PUBGOERS are being urged to leave their pint glasses behind this summer amid warnings that thefts are adding pressure to already struggling pubs.

The call comes after Jeremy Clarkson revealed that his Oxfordshire pub, The Farmer’s Dog, is losing up to 400 pint glasses a week.

Small business comparison site Bionic said the issue is not confined to one venue, with millions of adults admitting they have taken tableware from pubs, bars or restaurants.

Laura Court-Jones, Small Business Editor at Bionic, said: “Many people see taking a pint glass home as a harmless act, but the costs can quickly add up for pubs, bars and restaurants already facing rising expenses and tight margins.

“If you want to support UK hospitality and help your favourite venues thrive this summer, leave all pint glasses behind.”

Bionic said glass theft can also have consequences for customers.

Ms Court-Jones added: “Stealing glassware from a pub might seem like a minor offence, but it is still theft. Licensed premises have the right to refuse service and may bar individuals caught stealing.

“In some cases, the police may be called. While a prison sentence is unlikely for a minor offence, individuals may face a formal warning, a fine, or a criminal record.”

The company said pubs and bars can reduce losses by using CCTV, setting clear house rules, switching to unbranded glassware, and checking whether their insurance covers stolen or damaged stock.

Hospitality businesses across the UK have faced rising costs in recent years, including energy, staffing, food, drink and supplies, with many warning that even small losses can have a serious impact on margins.

Caption: Jeremy Clarkson at The Farmer’s Dog pub, where glass theft has reportedly become a major problem.

 

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Business

Planners reject farm’s sheep milk gin distillery expansion

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A CALL to keep a building which would partly be used a distillery at a Pembrokeshire farm which produces award-winning sheep milk-infused gin has been turned down by county planners.

In an application to Pembrokeshire County Council, Steven and Julie Ayers of Fifth Flock Spirits Ltd through agent Johnston Planning Ltd sought permission for the retention of a replacement building for farm diversification purposes incorporating a gin distillery with associated function/tasting room, reception area for farm businesses, including the distillery, a kennels and caravan site, along with offices and associated storage facilities at Nash Mountain Farm, Sardis.

Two previous similar 2024 and 2025 applications have been refused, the latest scheme removing some previous elements.

A supporting statement said the building would be used for farm diversification purposes for a number of established rural enterprises on the holding “but primarily in connection with Fifth Flock Spirits Ltd, a family run drinks company specializing in gin infused with milk derived from the resident flock at Nash Mountain”.

It said the 2023-erected building had replaced an earlier long-standing dilapidated farm building on the site, and is intended to play host to the three established farm enterprises which are run in conjunction with the main agricultural operation: Nash Mountain Kennels, Nash Mountain Caravan and Camping Site and primarily Fifth Flock Ltd.

It said internal works had yet to be completed, and, in addition to the retention of the building, the application also seeks permission for some external works which have not yet been carried out.

The statement said the Ayers family has farmed at 26ha Nash Mountain, which has a flock of 168 East Friesian sheep, for some five generations, the limited acreage meaning “the agricultural mainstay is not sufficient to sustain a viable business,” leading to the farm diversifications, with Fifth Flock the latest.

It said, in addition to the main farming operation, Nash Mountain also gains income from an on-site wind turbine, a caravan site, a boarding kennels with cattery, and Fifth Flock Ltd.

On the gin side, the statement says: “Fifth Flock Spirits Ltd Fifth Flock has operated from Nash Mountain since August 2025. It is at core currently a drinks enterprise based on the production of gin and rum infused with sheep’s milk, however, as set out in the accompanying business plan, the intention is to expand the offer into other sheep-based products to capitalise on the home flock.

“Since launching the enterprise has exceeded expectations with strong demand and accolades including A Taste of Pembrokeshire Award at the Pembrokeshire Food and Farming Awards in December 2025.

“Firth Flock currently source their gin from an independent distillery in Gorgeddan, Ceredigion however the intention, as reflected in this submission, is to develop the distilling element on-site and include it as part of an immersive visitor experience focussing on the home flock.

“Firth Flock has rapidly become a cornerstone of the enterprise at Nash Mountain and whilst the building at the centre of this proposal may have been premature there is a strong case for its retention as part of the overall rural enterprise on the holding.”

It adds that the Ayers are actively exploring diversification into other wool and sheep-based products.

The application was refused on the grounds including it was not demonstrated a countyside location was needed and there was not “sufficient evidence of a genuine and established rural enterprise necessitating the development,” adding: “In particular, the primary distilling process does not currently take place at the site and instead relies on off-site production, with only a future aspiration to relocate such activities.

“As a result, the proposal represents a speculative form of development that lacks a clear and direct functional link to the agricultural holding.”

It went on to say the scale of the proposals “introduces a level of intensity and built form more akin to a standalone commercial or tourism enterprise, rather than a modest farm diversification scheme”.

 

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Business

Plans for Ireland-UK fibreoptic cables to be connected at Pembrokeshire

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PLANS by a Vodafone phone company subsidiary to bring fibreoptic cables across the sea from Ireland to a Pembrokeshire seaside beach village in order to improve broadband coverage have been lodged.

In an application to Pembrokeshire Coast National Park, Apollo Submarine Cable Systems limited, through agent APEM Group, seeks permission for the construction of four underground telecom chambers and interconnecting ducts, along with Horizontal Directional Drilling (HDD) underneath Brandy Brook, Newgale, and the construction of one HDD bore-to-sea outfall.

A supporting statement accompanying the application says the scheme would form the onshore part of a project to bring a fibreoptic cable onshore from Kilmore Quay, Wexford, Ireland to a site at Newsurf Shop car park, Sands Café Car Park and Duke of Edinburgh Inn, Newgale.

It says the majority of the project is subterranean, with very minor above ground works are proposed, which comprise the installation of a manhole cover.

It adds: “To facilitate improved internet connectivity, the applicant is proposing the installation of a fibreoptic telecoms cable (the Beaufort cable) from Kilmore Quay, Wexford, Ireland to Newgale.

“The project is to facilitate the installation of the Beaufort cable, as it comes ashore in Wales and to link it into the wider network, which will be operated by Vodafone’s wholly-owned subsidiary Apollo Cable System Limited in the UK.”

It says the project would see three underground telecom chambers and a 120-metre interconnecting duct, the 87-metre HDD underneath Brandy Brook, launching from the receiver pit located within the Site, along with the construction of one HDD bore-to-sea outfall, in a subtidal area of Newgale bay, of approximately 920 metres, and one underground telecom chamber and interconnecting duct.

Citing a report on digital connectivity, it says 5G geographic coverage has seen improvements but is still relatively low at 57 per cent of Wales’ landmass, with 4G the primary service.

That report says there is a difference in full fibre coverage between urban and rural areas (83 per cent versus 59 per cent) and highlighting a need for further coverage.

On the scheme itself, the statement says short-term noise and disruption to local residents “is anticipated during the construction phase however this will be limited to 57 days,” adding: “The proposed drilling operations are not to be continuous and will be limited to approximately 20 minutes in each hour,” the works in total expected to last 91 days after which land will return to its former use without restrictions.

It goes on to say: “The HDD is specifically designed to mitigate the risk of any shoreward movement of the shingle bank and beach level changes. The use of HDD reduces the likelihood of potential environmental impact on the landscape and seascape.

“The project is not anticipated to interact with Brandy Brook. All drilling works will take place within excavated launch pits and all construction works will be confined to the hardstanding of the car park.”

The application will be considered by Park planners at a later date.

 

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