The Bank of England has reduced interest rates from 5% to 4.75%, but Governor Andrew Bailey cautions that further cuts will be gradual due to rising inflation risks linked to recent Budget decisions. While the cut provides immediate relief for over one million mortgage borrowers, it may negatively impact savers with lower returns. The Monetary Policy Committee’s decision, which saw an 8-1 vote, reflects mixed economic forecasts, with some experts now predicting slower rate decreases through 2026. Overall, the changing economic landscape suggests a careful navigation ahead for both homeowners and savers.