Bank of England Drops Rates to 0.5 Percent

The Bank of England cut their interest rates by half a percentage point on Thursday. With the recession deepening in the country, the bank lowered its rate (which already at an all-time low) to just 0.5 percent.

Bank of England

In an attempt to pump money into the economy and fight the recession, the Bank of England also decided to buy £75 billion ($105 billion) worth of private and public securities over the next three months. With growing unemployment, a declining housing market and problems in the financial services sectors, England’s economy has been hit worse than most other countries in Europe.

Bank of England had already dropped interest rates to the lowest in its 315-year history just last month. They also had begin buying short-term securities, but the new decision is to purchase £75 billion of longer-term securities.

Source: Bank of England, Image: Flickr