British Retail Consortium believes 0.50% cut is 'the kind of decisive action needed in the current financial turbulence'.
Stephen Robertson, BRC director general said: "This bold action by the Bank of England is the right decision and will be welcomed by hard-pressed customers and retailers.

"The banking crisis is undermining consumers confidence and a significant rate cut was necessary to restore confidence while stimulating the High Street and the rest of the economy.

"The slowdown will act as a downward pressure on prices. Commodity prices are falling rapidly, which will ease operating costs and so inflation should fall sharply."

He concluded: "It takes months for the benefits of a rate cut to filter through so cutting rates today will avoid the need for a bigger cut later on. This should only be the start of a series of reviving rate reductions."