Mounted police officers sit outside the Royal Exchange and the Bank of England in London on June 17, 2020.
Tolga Ekman | AFP by Getty Images
LONDON – The Bank of England on Thursday kept interest rates unchanged and maintained its current asset purchase levels, but warned that the outlook for the economy is “unusually uncertain”.
All members of the Monetary Policy Committee (MPC) voted to keep the key lending rate at 0.1% since the onset of the epidemic, while the central bank had reduced it from 0.75% since the onset of the epidemic. The MPCA also voted unanimously to maintain the target of કુલ 45 billion (60 60,660.60 billion) in total bond purchases.
Sterling was trading around 0.5% lower against the dollar soon after the announcement.
Britain faces the concomitant risks of a no-deal Brexit, some social sanctions are reintroduced as cases of coronavirus rise, and the government’s Furlo plan ends next month, which supported millions of inactive workers during the epidemic.
After sinking a record 20.4% in the second quarter to officially enter the recession, the UK economy showed signs of recovery with a 6.6% monthly expansion in July, after the nationwide lockdown measures were gradually lifted.
However, with more than 20,000,000 cases being filed every day, the government has been forced to impose new rules on social gatherings and local lockdowns in certain regions, casting doubt on the country’s recovery.
The bank said the recent increase in Kovid-19 cases in some parts of the world, including the United Kingdom, is likely to place more emphasis on economic activity, albeit at a lower level than seen earlier this year. Summary.
It added that “there is a risk of longer periods of elevated unemployment than the central estimate.”
Despite the expected domestic economic data in recent months, the central bank said the economic outlook remains “unusually uncertain” as its central expectations include free trade deals with the European Union, effective January 1, and gradual disintegration. Effect of Covid-19.
The MPC also said it “does not intend to tighten monetary policy until there is clear evidence that significant progress is being made in eliminating excess capacity and achieving the 2% inflation target on a sustainable basis.”
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