The Bank of England has retained the current 0.5% base rate. The interest rate has now remained constant for two consecutive months. But the Bank has boosted its commitment to quantitative easing by pumping £50 billion into the system.
The monthly review of the Bank’s rate sees no change to the base rate, but confirms its commitment to the policy of injecting cash into the system to buy corporate and government bonds. The plan is for a total investment of £75 billion by June.
Quantitative easing is designed to stimulate lending and promote economic growth by encouraging the banks to pass on the substantial cash injection to their customers through attractive loan and account rates.
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