Bank of England cuts rate to 0.1% as UK tightens Covid-19 restrictions
London — The Bank of England (BoE) cut interest rates to 0.1%, its second emergency rate cut in just over a week, and ramped up its bond-buying programme on Thursday in its latest attempt to shield Britain's economy from the coronavirus outbreak.
The BoE's Monetary Policy Committee voted unanimously for the rate cut and for a £200bn increase in the central bank's bond buying programme to £645bn.
Most of the extra debt the BoE will buy will be British government bonds, the BoE said as it followed other central banks around the world in ramping up their stimulus efforts.
Earlier on Wednesday, the SA Reserve Bank cut the repo rate by 100 basis points amid concern about the effect of coronavirus on economic growth.
Meanwhile, Prime Minister Boris Johnson's government put 20,000 military personnel on standby, closed dozens of underground train stations across London and Queen Elizabeth left the city for Windsor Castle amid the coronavirus crisis.
As the coronavirus outbreak sweeps across the world, governments, companies and investors are grappling with the biggest public health crisis since the 1918 influenza pandemic, panicked populations and imploding financial markets.
Against a background of panic buying in supermarkets and the biggest fall in sterling for decades, the British government moved to quash rumours that travel in and out of London would be restricted.
"There is zero prospect of any restriction being placed on travelling in or out of London," Johnson's spokesman told reporters.
He said police were responsible for maintaining law and order and there were no plans to use the military for this purpose, though the government put military reservists on formal notification.
Six passengers on the AIDAmira cruise ship, which set sail from Walvis Bay in Namibia on Friday and arrived off Cape Town on Sunday, were on the same flight as a sailor who has since shown coronavirus symptoms. The passengers had to be tested for Covid-19, while the rest of the 1,700 passengers and crew on board were trapped until the results were revealed.
But dozens of underground train stations across the capital were due to be closed and an industry source said supermarkets were expecting police support amid the fears that London was facing a virtual shutdown.
After ordering the closure of schools across a country Johnson on Wednesday said the government was ruling nothing out when asked whether he would bring in measures to lock down London.
Johnson has asked the government to come up with plans which would see businesses closed, transport services reduced, gatherings limited and more stringent controls imposed on the city.
Queen Elizabeth on Thursday left the capital for her castle at Windsor. The monarch has also agreed to postpone the planned state visit by Japanese Emperor Naruhito in June.
London's transport authority said it would close up to 40 underground train stations until further notice and reduce other services including buses and trains. The line between Waterloo station and the City of London financial district would be closed.
"People should not be travelling, by any means, unless they really, really have to," London mayor Sadiq Khan said.
Britain has so far reported 104 deaths from coronavirus and 2,626 confirmed cases, but UK scientific advisers say more than 50,000 people might have already been infected.
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