Bank Of England Cuts Rates To A Record Low

The Bank of England cut its main interest rate to a record-low 0.1 percent from 0.25 percent on Thursday, to tackle an "economic shock" from the coronavirus pandemic.

The announcement came only eight days after the BoE slashed borrowing costs to a then record-low 0.25 percent from 0.50 percent, also in an emergency move triggered by Covid-19.

Joining other central banks in stepping up action over the virus, the Bank of England has also increased holdings of UK government and corporate bonds to £645 billion (US$766 billion), an increase of £200 billion, to pump much-needed liquidity into markets.

"The spread of Covid-19 and the measures being taken to contain the virus will result in an economic shock that could be sharp and large, but should be temporary," the BoE said in a statement following the special meeting.

The central bank added that it was helping "to meet the needs of UK businesses and households in dealing with the associated economic disruption".

The announcement came one day after new BoE governor Andrew Bailey urged companies to hold back from cutting job because of the virus fallout. (AFP)