11th March 2020
LONDON (EconoStream) – The Bank of England Monetary Policy Committee (MPC) this morning announced an emergency rate cut of 50bp down to 0.25% outside of their usual policy meeting schedule in response to the Covid-19 outbreak. The Bank of England hadn’t been due to make its next policy decisions until their meeting on 26th March but took the emergency step following a similar move by the US Federal Reserve last week. The MPC have not announced any new measures of changes around their QE policy.
The rate move by the Bank is actually part of a package of measures announced by their 3 key policy committees. The Financial Policy Committee (FPC) also reduced the UK countercyclical capital buffer rate to 0% from 1% while the Prudential Regulation Authority (PRA) issued new Supervisory guidance that banks should not increase dividends or bonuses, in response to these policy actions.
The full release from the Bank of England can be seen here: https://www.bankofengland.co.uk/news/2020/march/boe-measures-to-respond-to-the-economic-shock-from-covid-19
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