Bank of England cuts interest rates to 2%04 Dec 2008The Bank of England has slashed interest rates by one percentage point - the third cut in as many months. The decision takes the base rate to just 2%, its lowest level since 1951.The Bank’s monetary policy committee (MPC) had been under increasing pressure to reduce rates following the publication of a string of poor economic data.'Across the UK, deteriorating house prices and rising unemployment are both taking their toll on business and consumer confidence,' said Trevor Williams, chief economist, Lloyds TSB Corporate Markets. 'All of this, combined with the prospect of sharp falls in inflation, means that today's cut was fully justified.'The MPC’s latest decision, which follows a dramatic cut in November, has been applauded by the business community.'We are pleased with the MPC's decision,' said David Kern, Chief Economist at the British Chambers of Commerce. 'The less than impressive reaction to the PBR, and worrying signs that UK activity is falling sharply, make it critically important for the MPC to persevere with aggressive rate cuts. The UK economy faces serious risks.'Meanwhile, the Confederation of British Industry said it was 'critical for business and consumers' that the reduction is passed on by the banks.