It is expected to announce an increase of at least £100billion in its bond-buying programme. The bank has spent most of the £200billion it gave itself in March as it covers the Government’s borrowing. Governor Andrew Bailey told the Commons Treasury Select Committee last month, borrowing rates might drop below zero for the first time: “Of course, we’re keeping the tools under active review in the current situation.
“We do not rule things out as a matter of principle”.
“We’re very keen to observe how the economy responds to the cuts that we have made.”
This was in reference to rates being cut to 0.1 percent in March.
The figure is a record low.
The review, however, is likely to take time.
If a government wants to borrow money, it can sell bonds to investors.
The investor then gets a regular stream of future payments.
The Bank of England can limit borrowing costs paid by business and consumers as well as the public sectors.
The expected increase will allow the Bank to continue buying bonds until August, at the rate it is doing currently.
Chancellor Rishi Sunak has a major stimulus package of tax cuts and spending set for the autumn.
It is understood to have been delayed until then to allow for time to see how the economy is doing before making further commitments.
Mr Sunak has already spent £133billion to ease the economic burden of the pandemic.
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The Treasury told the Telegraph: “We will be taking stock of the economic situation, and looking at if and where further support makes sense ahead of the more significant moments in the autumn.”
Mr Sunak is still expected to announce some measures next month.
Though this will not be an emergency budget or mini-budget according to speculation, The Treasury insisted.
In the most recent daily update, there had been a further 184 deaths from coronavirus.
There have thus been 42,153 total deaths from coronavirus.
A total of 140,359 tests took place on June 16.
1,115 of these tested positive.
There have been 7,121,976 tests overall.
299,351 have come back with a positive test.
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