London [UK], Mar 11 : The Bank of England has slashed interest rate to a record low and have launched other measures to limit the economic fallout from the novel Coronavirus (Covid-19), the Central bank said in a statement on Wednesday.
The scale of the economic shock remains highly uncertain, the bank also added that the economic activities are "likely to weaken materially in the United Kingdom over the coming months," reported CNN Business.
This move came after the US Federal Reserve decided to slash interest rates by half a percentage point last week. The European Central Bank, which will meet in Frankfurt on Thursday, is also expected to slash interest rates further and introduce other financial measures as Europe gears up to fight the economic setback due to the virus.
The Bank of England's decision to slash its interest rate by half a percentage point to 0.25% is in line with to help keep firms in business and people in jobs. According to the Bank of England, this would also help prevent a temporary disruption from causing long-lasting economic harm.
UK Finance Minister Rishi Sunak is expected to unveil more steps for the British economy when he publishes his budget for 2020.
Bank of England Governor Mark Carney said that the measures announced by the central bank constitute a big package and were coordinated with those in the government's budget to ensure the maximum impacts of the policies.
The FTSE 100 (UKX) gained roughly 1% in London as investors cheered the synchronised response.
( With inputs from ANI )