The Bank of England cut the Bank Rate by 25 basis points to 3.75%, its lowest level since 2022, as easing inflation and growing signs of economic strain prompted policymakers to act. The move marked the first rate cut since August, following rate holds in September and November. Five policymakers voted for the cut while four wanted to keep the rate unchanged. UK annual inflation slowed to 3.2% in November, the lowest reading in eight months and below the BoE’s forecast of 3.4%. At the same time, GDP contracted for a second consecutive month in October, while private-sector wage growth continued to cool. Investors will closely watch the vote split and guidance from the nine-member Monetary Policy Committee for signals on the policy outlook in 2026. Markets increasingly believe the central bank is nearing the end of its easing cycle, with only one additional rate cut fully priced in for next year.