At its meeting today, the Monetary Policy Committee (MPC) decided to reduce the Bank Rate by 1 percentage point to 10 percent. Reflecting the continued easing of inflation over the past year, the Bank Rate has now been reduced by a cumulative 5.5 percentage points since December 2008. In November, inflation fell further, by 1.9 percentage points, due to the falling away of the impact of the special alcohol levy introduced the previous year, and, at 5 percent, is comfortably within the objective range of 3 – 6 percent. While fluctuations around this level can be expected in the coming months, inflationary pressures remain generally benign in the context of subdued growth, and inflation is expected to stabilise within the objective range during 2010. However, the potential for upside inflationary risks to emerge remains, and the Bank continues to be committed to responding appropriately to all economic and financial developments. This is so as to maintain price stability in the medium term, which contributes to sustainable economic growth. For more details see the press release, which includes an extended commentary on recent economic developments.