Commenting on the surprising decision of the US Central Bank to cut its discount rate David Kern, economic adviser to the British Chambers of Commerce, said:

"The Fed’s decision highlights the growing threat to the global economy resulting from the current turmoil in the international financial markets. In explaining the decision, the Fed state that "downside risks have increased appreciably".

"While we are not calling for an immediate cut in UK rates, we think it is important the MPC makes it absolutely clear that UK interest rate increases are no longer on the agenda at present, and if global threats worsen they will not hesitate to cut rates as well. "