Bank of England cuts rate to historic low
nLONDON: The Bank of England (BOE) on Thursday cut interest rate in an emergency move to support the UK economy in the face of the coronavirus pandemic to 0.1%—the lowest it has been in British history—as the death toll rose to 128.
Lowering the interest rate was among new plans of the Boris Johnson government to deal with the growing scale of the challenge, including publishing a new bill in the House of Commons to provide more emergency powers to authorities.
The government said the new powers will be used only if needed, judged on the basis of the clinical and scientific advice. Safeguards have been built in to ensure that powers are only used as necessary, for example during the peak of a coronavirus outbreak.
“The aim is to balance the need for speed, as appropriate to the risk posed by the virus, with safeguards to ensure proper oversight and accountability”, the government said.
The bill has four primary categories of effect, which involve enhancing capacity and the flexible deployment of staff, easing of legislative and regulatory requirements, containing and slowing the virus, and managing the deceased”.
Queen Elizabeth moved from Buckingham Palace to Windsor as part of social distancing.
The Bank of England headed by the new governor Andrew Bailey said it would also increase its holdings of UK government and corporate bonds by £200 billion, effectively pumping more money into the economy.
Last week, the bank announced a 0.5% cut in rates to 0.25% and a package of measures to help businesses and individuals cope with the economic damage, but went further on Thursday and cut it to an all-time low to 0.1%.