The Bank of England has boosted its quantitative easing stimulus package by £150bn, as policymakers try to protect the economy from the coronavirus pandemic.
The Bank warned that the new restrictions imposed to combat Covid-19 mean the UK economy will shrink in the current quarter. That means Britain would suffer a double-dip downturn this year.
The Bank of England said: “There are signs that consumer spending has softened across a range of high-frequency indicators, while investment intentions have remained weak…
“Developments related to Covid will weigh on near-term spending to a greater extent than projected in the August Report, leading to a decline in GDP in 2020 Q4.”
The expansion of the Bank’s asset purchase scheme is bigger than economists expected, and has been announced as the England’s second coronavirus lockdown begins.
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