The Bank of England cut interest rates from 4.25% to 4% on Thursday as the central bank resumes a "gradual and careful" approach to lowering interest rates.

The Bank of England has cut its main interest rate by a quarter percentage point to 4%, as policy makers seek to bolster the sluggish U.K. economy.

By contrast, the European Central Bank expects inflation in the euro zone to hold below 2%. It has cut borrowing costs eight times since June of last year, three more reductions than those of the BoE. Inflation has been above the BoE's 2% target almost constantly since May 2021.