Bank of England makes further £150bn available to support economy

THE Bank of England makes a further £150bn available to support the economy as the country starts its second national lockdown.

The Bank of England has boosted its quantitative easing stimulus package by £150bn, as policymakers try to protect the economy from the coronavirus pandemic.

The Bank warned that the new restrictions imposed to combat COVID means the UK economy will shrink in the current quarter and would suffer a double-dip downturn this year.

The Bank said the extra £150bn of aid reflected its downgraded forecasts that the economy would now remain below its pre-pandemic peak through the first quarter of 2022 but announced in the latest meeting of its Monetary Policy Committee (MPC) that interest rates will be kept at their record low of 0.1%.

This fresh injection of QE will boost the Bank’s total package to £895bn – used to buy £875bn of government bonds (plus £20bn of corporate debt).

The announcement was perfectly timed as MPs have decided on an expansion of the furlough scheme beyond December.

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