The Bank of England slashed interest rates by another 1% today as policymakers stepped up their battle to stave off a deep recession.

The dramatic percentage point cut takes the cost of borrowing from 3% to 2% - a rate not seen since 1951 and equal to the all-time record low in the UK.

It follows last month's shock 1.5% cut - the biggest for more than 27 years - and comes amid mounting concern that the UK is facing a deep and prolonged recession.

Britain's biggest mortgage lender Halifax confirmed it would pass on the cut to its 600,000 borrowers with base rate tracker deals.

But it is unlikely that all borrowers with standard variable rate mortgages will see the full benefit, despite increasing pressure from the Government.