Reaction to Bank of England emergency interest rate cut
interactive investor’s head of markets gives his thoughts on the Bank of England’s 50bps rate cut.
11th March 2020 09:14
by Richard Hunter from interactive investor
interactive investor’s head of markets gives his thoughts on the Bank of England’s 50-basis-point rate cut to 0.25%.
Markets had been hoping for a coordinated turbocharge from the Central Banks, which, given the decreasing lack of firepower for most given the stimulus measures already introduced, could have limited effect.
However, if this is accompanied by a pledge from governments to add fiscal stimulus into the mix, the combined statement of intent could well underpin market sentiment.
With some interest rate cuts already announced globally and hopes for a similar statement from the US imminently, the Bank of England have now made their contribution on the monetary side for easing conditions in what could be a beleaguered UK economy in the short term.
The baton now passes to the government ahead of the Budget, where hopes of fiscal policy easing will now be heightened.
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