Barclays expects the Bank of England to hold interest rates at its December meeting, revising its prior forecast of a cut, citing the central bank's cautious tone that emphasized uncertainty and gradual policy moves.

The Bank of England has cut interest rates to 4.75 per cent after inflation fell to a three-year low in September. The eight-to-one decision to cut the base rate by 0.25 percentage points was in line with the expectations of economists polled by Reuters.

The Bank of England cut interest rates on Thursday for only the second time since 2020 and said future reductions were likely to be gradual as it predicted the British government's first budget would lead to higher inflation and economic growth.

The Bank of England on Thursday said it was cutting its key interest further after UK inflation hit a three-year low and signalled more reductions, easing pressure on borrowers.

Bank of England has slashed its interest rates by over 4%. Owing to the higher inflation and growth after the new government's first budget, the bank has further announced that the reductions were likely to be gradual.