In a first since 2009, the Bank of England on Thursday lowered interest rates to a record low, anticipating that the economy will deteriorate for the rest of the year and that the country will see weak growth in 2017. The central bank cut its main lending rate to 0.25% from 0.5%, in accordance with market expectations, Reuters reported.

The move is part of efforts to lessen the impact of the June 23 Brexit vote, when Britain decided to no longer remain with the European Union in a referendum. In its quarterly Inflation Report, the bank said: "Following the United Kingdom's vote to leave the European Union, the exchange rate has fallen and the outlook for growth in the short to medium term has weakened markedly."

BoE also introduced two new schemes to make sure that the interest rate cut does not stop banks from lending. The schemes include buying high-grade corporate bonds worth £10 billion as well as bonds worth up to £100 billion.

According to a number of surveys, Britain's economy has seen a sharp decline since the Brexit vote and may even be headed for a recession. BoE estimates for growth in 2016 remain unchanged at 2% – owing to the better performance the economy saw in the first half of this year – but its growth expectation for 2017 has dropped drastically from 2.3% to 0.8%.