By Ashley Young-
The Bank of England is about to unveil another big stimulus for the U.K. economy on Thursday as it tries to limit the scale of the coronavirus recession.
The central bank is on schedule to merge with its counterparts around the world, including the U.S. Federal Reserve, in bolstering support measures following the initial radical responses to the economic threat of the pandemic.
The purpose of the meeting of the bank’s monetary policy committee is to address the U.K. economy. The UK economy shrank by a fifth in April alone as a result of the country’s lockdown, which has seen many sectors shuttered.
The intention is to keep a lid on interest rates and keep money flowing through the financial system.
The meeting of the Committee comes as the U.K. economy is set for one of its worst recessions in living memory, alongside a consequent big spike in unemployment. Last month, the Bank warned that the U.K. faced its worst recession since 1706.
In addition to the bank’s support measures, the British government is preparing a big fiscal package for this summer to help the economy, potentially involving a sales tax cut and funding big transport and green projects.
It has already implemented an array of hugely expensive support programs to deal with the initial economic fallout of the coronavirus. The Job Retention Scheme, for example, is widely credited with limiting the number of people losing their jobs. But it is set to end this autumn, and there are worries that firms will start cutting jobs at an accelerating rate through the summer.