Interest rates have been cut in an emergency move made by the Bank of England in an attempt to boost the economy amid the outbreak of Coronavirus.
The Bank of England has cut the base rate from 0.75% to 0.25%, the joint-lowest in history.
Mark Carney, the Bank's outgoing governor, said there had been a "sharp fall in trading conditions" in recent weeks.
He said: "The Bank of England's role is to help UK businesses and households manage through an economic shock that could prove large and sharp, but should be temporary."
The global economy is forecast to grow at its slowest rate since the financial crisis in 2008. The Bank of England said it expects the UK economy to "weaken materially", stressing that the impact on small businesses is "likely to be most acute".
It comes as the Chancellor Rishi Sunak prepares to deliver his first Budget, pledging to increase funding to support the UK's efforts to battle the spread of the virus. He is also expected to announce measures to support self-employed workers and small businesses.
The Bank also announced a new £100 billion scheme to help households and smaller businesses take advantage of the cut to interest rates.
It also said limitations on capital lending would be eased, meaning banks could lend an additional £190bn to "help UK businesses and households bridge across the economic disruption that is likely to be associated with Covid-19".
The Bank added: "These measures will help to keep firms in business and people in jobs and help prevent a temporary disruption from causing longer-lasting economic harm."