Bank of England Cuts Interest Rates to 0.25%

UK interest rates have been cut for the first time in more than seven years as the Bank of England moves to boost the economy in the wake of the Brexit vote

Emma Wall 4 August, 2016 | 12:04AM

UK interest rates have been cut to a new record low of 0.25%. More than seven years after the Bank of England cut rates to 0.5%, economic concerns following the Brexit vote have led the Monetary Policy Committee to vote for a further rate cut.

Bank Governor Mark Carney announced at midday today that the MPC had voted to cut interest rates to 0.25% at 9 member votes to 0.

The Bank of England has also announced a quantitative easing programme worth £70 billion, of which up to £10 billion can be spent buying high quality sterling corporate bonds issued by companies that make a material contribution to economic activity in the UK. The remainder will be gilt purchases. This is the first QE in more than three years, although 20% of outstanding gilt assets in the UK belong to the Bank from prior QE initiatives.

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Emma Wall  is former Senior International Editor for Morningstar

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