The Bank of England has announced the first cut in interest rates in more than seven years and delivered an emergency £170 billion package in a bid to prevent a recession in the wake of the Brexit vote.

Policymakers on the Bank's Monetary Policy Committee (MPC) voted unanimously to cut the base rate from 0.5% to the new record low of 0.25%.

The MPC officials also voted 6-3 to fire up the printing presses once more to expand its quantitative easing programme by £60 billion to £435 billion - the first QE increase since 2012.

The Bank will also buy £10 billion of corporate debt while announcing a new £100 billion scheme to encourage banks to lend to households and businesses.

The Bank warned over "little growth" until the end of the year as it delivered its biggest downgrade on record for 2017-2018.

Officials believe the measures will see the UK avoid dropping into recession, but the Bank warned of a "material slowdown", higher unemployment and falling house prices over the next year.

The policymakers had surprised economists and investors when it kept rates on hold last month.

The Bank last cut rates in March 2009 at the height of the financial crisis.

While the move will be welcomed by borrowers, the lower rate spells further misery for long-suffering savers.

Bank governor Mark Carney suggested rates would come down in July or August following June's EU referendum.

Mr Carney warned in May that a Brexit vote could trigger a recession and has since said many of the risks previously flagged up have begun to "crystallise".

While last week's gross domestic product figures estimated a better-than-expected 0.6% rise in the second quarter, this is expected to have reversed sharply since the Brexit vote.

Closely-watched purchasing managers' index (PMI) surveys on the three major sectors of the economy pointed to a record fall in activity last month and raised recession fears.

The readings signalled a shock contraction in the dominant services sector for the first time since the end of 2012 and the biggest monthly fall in activity on record.

The all-sector PMI suggested a 0.4% fall in GDP in the third quarter.

More Bank rate reductions appear to be on the cards.

The minutes of the Monetary Policy Committee (MPC) meeting reveal most members expect to cut rates to a "little above zero" by the end of the year if growth slows as expected.