Bank of England Decides to Keep Base Interest Rate at 0.1%

[Asia Economy Reporter Kiho Sung] The Bank of England (BOE), the central bank of the United Kingdom, has kept its base interest rate unchanged.

The Bank of England's Monetary Policy Committee (MPC) announced on the 17th that, following its regular meeting on the 16th (local time), it unanimously decided to maintain the base interest rate at the current 0.1%. The 0.1% rate is the lowest level in the history of the UK's base interest rate.

Earlier, as the novel coronavirus disease (COVID-19) spread, the BOE held a special MPC meeting on March 10 and sharply cut the base interest rate from 0.75% to 0.25%. Then, less than ten days later, on March 19, another special meeting was held, further lowering the base interest rate by 0.15 percentage points from 0.25% to 0.1%. Since then, the MPC has kept the rate unchanged through five regular meetings up to this September.

The MPC also decided to continue increasing its holdings of government bonds and non-financial corporate bonds by ?300 billion (approximately 456 trillion KRW). Expanding bond holdings supplies new liquidity to the financial system and helps reduce borrowing costs for companies and others.

This move signifies the resumption of the asset purchase program, commonly known as quantitative easing, which was first implemented after the 2008 financial crisis.

This content was produced with the assistance of AI translation services.