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Bank Of England Cuts Rate By 50 Bps, Unveils Funding Scheme For SMEs On Covid-19

By RTTNews Staff Writer   ✉  | Published:  | Google News Follow Us  | Join Us
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The Bank of England unexpectedly cut its key interest rate and launched a new funding scheme for small businesses as it expects the UK economy to take a major hit due to the coronavirus, or Covid-19, outbreak.

The Monetary Policy Committee unanimously voted to cut the bank rate by 50 basis points to a record low 0.25 percent, following a special meeting on March 10, the central bank said in a statement on Wednesday.

The MPC also voted unanimously to introduce a new Term Funding scheme with additional incentives for Small and Medium-sized Enterprises, or TFSME, financed by the issuance of central bank reserves.

"Although the magnitude of the economic shock from Covid-19 is highly uncertain, activity is likely to weaken materially in the United Kingdom over the coming months," the Bank of England said.

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