In the face of this, the Bank has decided to massively reduce interest rates, now down to 1.5%. Today another 0.5% cut is expected. I don't see this as having much effect on the real economy in the UK. It is not as if banks are going to cut the rates they charge businesses for lending in such a difficult environment. It may help to lower LIBOR - but no one cares about that anymore as no banks lend to each other anyway.
With real courage, the bank would leave the rate where it is, acknowledging that this phase of economic policy has reached its final point. The next phase is to replace bank lending to companies with direct government lending, this will stimulate the economy as is needed.
Done well it may even turn a small profit for the HM Treasury.
The bank need to wrestle back control from the markets and stop copying slavishly every US decision. Inflation is going to fall anyway, negative rates are not the answer - just look at Japan 1990-2008.
UPDATE: As predicted, they did the 0.5% cut.