Expert comment: Timely Bank of England intervention shows UK policymakers ready to support economy

Dr Ivan Petrella, Associate Professor at Warwick Business School and an expert in economic policy, said: “This is a timely move by the Bank of England, taking a number of preemptive measures aimed at supporting the economy in the face of the Covid-19 epidemic.

“This includes a 50bp cut to interest rates, but more importantly, a new Term Funding Scheme with additional incentives for small businesses and countercyclical capital buffer. These actions provide liquidity and much-needed support for SMEs, which are most vulnerable to the Covid-19 shock.

“The timing, ahead of the measures expected in the 2020 Budget, gives a clear indication that UK policymakers are ready to make a coordinated effort to support the economy.

“The fact that fiscal and monetary policy will be singing the same tunes will certainly be welcomed by the markets.”