The Bank of England is set to unveil another $125 billion stimulus package as it fights coronavirus
UK's central bank is expected to add another $125 billion of monetary stimulusto boost its asset purchase program and stabilize the economy, the Financial Times reported on Wednesday.
- The Bank of England's Monetary Policy Committee is scheduled to announce its latest monetary policy decisions on Thursday, with an extension of quantitative easing likely.
- Data released Wednesday by the country's statistics authority showed UK
inflationdropped to a four-year-low of 0.5% in May as prices for fuel and other retail goods continued to fall.
- With the UK economy shrinking by 20% in April and further job losses in May, the central bank is facing intense pressure to do more to shore up the economy.
- Visit Business Insider's homepage for more stories.
The Bank of England is expected to inject another fresh dose of stimulus worth about £100 billion ($125 billion) to financial
The UK's central bank is scheduled to announce its latest monetary policy decisions on Thursday, after a Wednesday meeting of the Monetary Policy Committee (MPC), with an extension of quantitative easing likely announced. Interest rates are likely to be kept unchanged at 0.1%.The bank's asset purchase program allows creation of money to flow into large quantities of government bond purchases alongside a smaller scale of corporate debt purchases.Advertisement
Bank of England's latest
Official data from the Office of National Statistics showed that UK inflation dropped to a four-year low of 0.5% in May, alongside a record slump of 16.7% in fuel costs due to low global oil prices.Read More: Famed investor Jim Rogers earned a 4,200% return with George Soros. He explains why the US response to COVID-19 is 'embarrassing' — and breaks down 4 purchases he's made amid the fallout.
That dragged the UK consumer price index — which measures the variation in prices for retail goods and other items — to its lowest level since June 2016, the month in which the UK voted to leave the EU.The UK's benchmark FTSE 100 was up 0.8% in early European trading "as investors ignored the fact that the UK just posted its lowest inflation number since June 2016," Connor Campbell, a financial analyst at SpreadEx, said in a note. With the UK economy shrinking by more than 20% in April and further jobless claims in May, the central bank is under immense pressure to continue an influx of a high level of monetary stimulus.Advertisement
Over two emergency meetings held earlier in March, the bank had announced an increase in its total quantitative easing program to £645 billion ($811 billion) and slashed interest rates from 0.75% to 0.25% in an effort to shore up the economy as financial market uncertainty reached "extreme levels" during the start of the
It then cut rates again to 0.1%, the lowest level in UK history.The British government had announced £330 billion ($414 billion) of bank loans to support businesses that were faced with distress or about to go bankrupt at the peak of the outbreak. Advertisement
Read More: Main Street traders have been crushing Wall Street in recent months. Goldman Sachs breaks down what retail investors should buy to keep winning — and lists the 12 stocks leading the charge.
- Lebanon's prime minister and his entire cabinet have resigned following last week's deadly explosion in Beirut
- Karnataka is seeking ₹4,000 crore from the Central government to fund its flood relief measures
- Sachin Pilot says "his fight was ideological and not personal"
- Best yoga mats
- IndiGo to raise ₹4,000 crore through stake sale