Danni Hewson, head of financial analysis at AJ Bell, said a 0.25 percentage point cut was “pretty much nailed on” for November and expectations of a second cut in December had “jumped up”.

Yael Selfin, chief economist at KPMG UK, warned that although the Bank would be likely to drop rates next month, inflation is likely to rise again with household energy bills increasing this month by around 10%.

The Bank’s base interest rate heavily influences the rates High Street banks and other money lenders charge customers for loans, as well as credit cards.

The higher level has meant people are paying more to borrow money for things like mortgages, but savers have also received better returns. Increased mortgage repayments for landlords can also result higher rents.

The cost of living has surged in recent years, with inflation peaking at 11% in 2022 – way above the Bank of England’s 2% target, partly due to the increase in energy prices following Russia’s invasion of Ukraine.

To try to slow price rises, the Bank increased rates to encourage people to spend less, and bring inflation down.

While the rate has dropped, falling inflation does not mean the goods and services are coming down in price overall, it is just that they are rising at a slower pace.