Why did they cut interest rates to 4.975%?

Lawks, crikey and cripes, I said to myself. While I was of the opinion that interest rates may have been held a little too high for too long (but frankly, I doubt a change will make much difference as long as Libor is out of control from the Bank of England's effects) I was surprised to hear that they had cut the borrowing rate by such a tiny amount.

I was, of course, incorrect. Or, to be more accurate, I was perfectly correct and every news reporting institution in the country was wrong. Every report all day yesterday reported quite clearly that

the Bank of England's Monetary Policy Committee has cut interest rates by half of one percent.

No they bloody didn't, you bag of muppets! Allow me to take you back to Elementary Mathematics 101.

• One-half of one percent of 5 is 0.025
• Therefore 5 - 0.025 = 4.975. This is what the interest rate would be with a 0.5% cut.
• The difference between 5 and 4.5 is 10% because, as every school boy knows (or at least they used to know: these days they probably don't) 10% of 5 is 0.5.

And 0.5 is exactly the drop in percentage points that the MPC cut interest rates by yesterday. Not 0.5%, but by 10%.

All broadcast media in the UK please take note. There are three ways you could have accurately reported this news:

• Interest rates have been cut by 0.5 percentage points to 4.5%
• Interest rates have been cut by 50 basis points to 4.5%
• Interest rates have been cut by 10% to 4.5%

All of these are correct. It is a small point, but it is important. Please get it right next time. I'd hate to think that all news agencies are as inaccurate when it comes to numerical business reporting as Newsnight. That would be very bad.

[/pedant]