BRITAIN CUTS INTEREST RATES
LONDON — Britain cut interest rates by half a percentage point May 5 in a move to help the economy out of its longest business recession since the 1930s.
The Bank of England cut its money market dealing rate, encouraging commercial banks to follow suit and cut base lending rates to 10 percent from 10.5 percent.
The reduction was the first since September 1991 and brought British rates to their lowest for four years.
The move followed a general election victory for the ruling Conservative Party April 9, after which the pound sterling strengthened on foreign exchanges. Industrial unrest in Germany, where public-sector workers are on strike for higher pay, weakened the mark and helped pave the way for lower British rates.