BOE surprises with rate cut to record low, £170b stimulus

London

THE Bank of England (BOE) has exceeded market expectations in its latest moves: it has not only slashed interest rates to record UK lows of 0.25 per cent, but also launched a £170 billion (S$300 billion) quantitative easing and lending programme to boost the post-Brexit economy. And it signalled that further measures are in the offing if the UK economy doesn't improve.

In response to the BOE's monetary boost, sterling tumbled by one per cent, albeit still trading around 2 to 3 per cent above its early July lows following the June 24 vote to leave the European Union (EU). The FTSE 100 and gilts long term government bonds jumped by around 1.5 per cent, and shares are now well above their late June lows.