The Bank of England's monetary policy committee today cut interest rates by a full percentage point to just 2% - the lowest for 57 years and the joint lowest in history.

The cut was widely expected after a run of awful data from every part of the economy this week which suggested that Britain is tipping into a long and deep recession that could last a lot longer than Alistair Darling predicted in last week's pre-budget report.

TUC General Secretary Brendan Barber said: "This decision was spot on. The Bank of England could not be clearer about what it expects the high street banks to do.

"The government must now pull every lever of influence to get banks lending. If that doesn't work, radical measures will be needed straight away. The alternative is a wave of bankruptcy and redundancy."

HSBC said it would pass on the rate cut in full, as Lloyds TSB had promised yesterday it would. The Halifax said it would pass on the rate cut in full to all its tracker rate customers, brushing aside a previous downward limit on rates. But Royal Bank of Scotland said that while it would pass the cut on to its business customers, it would "strike an appropriate balance between the interests of savers and borrowers in any decision it makes" on personal customers.

Guardian.co.uk