The Bank of England has cut interest rates by half a percentage point
in an emergency move to fight the economic fallout from the coronavirus pandemic.
In a statement, the central bank said that while the magnitude of the shock from the coronavirus remains “highly uncertain,” economic activity is “likely to weaken materially in the United Kingdom over the coming months.”
It said that slashing its main interest rate to a record low 0.25% would “help to keep firms in business and people in jobs and help prevent a temporary disruption from causing longer-lasting economic harm.”
The Bank of England also noted the hit to financial markets in recent days, with stocks and commodities falling sharply and government bond yields reaching record lows.
Indicators of financial market uncertainty have reached extreme levels,” the bank said.
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