BoE voted unanimously to keep Bank Rate unchanged at 0.10% as widely expected. The government bond purchases problem is expanded the target stock of purchased UK government bonds by additional GBP 150B, taking to the total to GBP 875B. The central bank will “continue to monitor the situation closely” and “stands ready to take whatever additional action is necessary”.
Also, BoE “does not intend to tighten monetary policy at least until there is clear evidence that significant progress is being made in eliminating spare capacity and achieving the 2% inflation target sustainably.”
It’s noted in the statement that there has been a “rapid rise in rates of Covid infection and increased severity of restrictions as response. Covid development will lead to a “decline in GDP in 2020 Q4”. Economic outlook remains “unusually uncertain”, depending on the pandemic and measures, as well as post Brexit new trading arrangements.
