Bank Of England Keeps Interest Rate At Record-Low 0.1%

The Bank of England on Thursday said it had decided to keep its main interest rate at a record-low 0.1 percent as the UK economy emerges from its coronavirus lockdown.

“The outlook for the economy… continues to depend on the evolution of the pandemic, measures taken to protect public health, and how households, businesses and financial markets respond to these developments,” the BoE said in a statement.

The BoE voted also at its Wednesday meeting to maintain the vast amount of stimulus pumping around the UK economy.

As the pandemic erupted in March 2020, the BoE slashed its key interest rate to a record-low 0.1 percent, where it has remained.

It also began pumping out huge sums of new cash to help stimulate the economy.

The bank has created £450 billion ($626 billion, 522 billion euros) under its quantitative easing stimulus programme since March 2020, when Covid-19 prompted Britain’s first coronavirus lockdown.

Prior to this it had pumped hundreds of billions of pounds worth of QE into the UK economy over a decade in the wake of the 2008-09 global financial crisis and Brexit.

The central bank’s total QE package stands at £895 billion.

The BoE on Thursday said “developments in global GDP growth have been a little stronger than anticipated, and the substantial new US fiscal stimulus package should provide significant additional support to the outlook”.

But it cautioned that “the outlook for the economy, and particularly the relative movement in demand and supply during the recovery from the pandemic, remains unusually uncertain”.