The Bank of England has cut interest rates to an all-time low of 0.1% to help lower the impact of coronavirus on the economy.
The impact of COVID-19 on the economy is expected to be significant, with the Bank of England issuing a statement warning that “a further package of measures was warranted.” They added that “the spread of COVID-19 and the measures being taken to contain the virus will result in an economic shock that could be sharp and large, but should be temporary.”
The Chancellor of the Exchequer, Rishi Sunak, announced on 18 March 2020 that they would ‘provide as much capacity as required” to support businesses across the country, but concerns remain that the financial impact of the virus on businesses and individuals will ultimately result in a recession. Lowering the interest rate to its absolute minimum is one more measure in an effort to prevent this from happening.
Dorset Chamber Chief Executive Ian Girling said: “This unprecedented move shows the gravity of the situation facing us as the outbreak continues to escalate rapidly. That the Bank has acted so quickly and so decisively is clearly part of a concerted effort with the Government to support the economy and provide reassurance for business and the general public.
“It is absolutely vital that we see money in the economy to keep businesses afloat and the wheels of commerce turning. The Government and Bank must continue to do the right thing and stay ahead of the coronavirus curve where possible.As a chamber we also call on businesses to act responsibly, particularly large businesses, in ensuring their suppliers are paid promptly.
We will continue offer support and advice for members and non-members across Dorset during these extraordinary times.”