The pound strengthened against both the euro and dollar yesterday, and is still strong this morning after the Bank of England made a second emergency cut to interest rates. As expected, the Bank also announced that it would be boosting its quantitative easing programme.
Rates have now been cut to 0.1% to mitigate the risks of coronavirus and government and corporate bond holdings have been increased by £200 billion. New Governor of the Bank of England, Andrew Bailey, said, “The obvious increase in the pace and severity of Covid-19, which has built during the week, was something we had to assess and respond to, we can’t wait for the hard economic data before we act.”
Yesterday, Boris Johnson said that we can “turn the tide” of the coronavirus crisis within 12 weeks. However, he then added, “We don’t know how long this thing will go on for. But what I can say is that this is going to be finite.”
