Here’s what the Bank of England is doing to tackle coronavirus

The Bank of England has cut interest rates by 0.5 percentage points to just 0.25%. John Stepek explains how this could help tide the economy over the period of coronavirus disruption.

The interest-rate cut is about getting banks to lend to businesses © Getty
(Image credit: Bloomberg via Getty Images)

Budget Day has started with a bang. The Bank of England has followed the Federal Reserve, and announced an emergency interest rate cut, from 0.75% to 0.25%. Rates are now back at their post-financial crisis record low. What will that do? Quite probably not very much on its own.

As we’ve pointed out before, if people haven’t been investing or spending with the base rate at 0.75%, a half-point cut won’t make the difference. And right now, what we’re facing is very different.

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John Stepek

John Stepek is a senior reporter at Bloomberg News and a former editor of MoneyWeek magazine. He graduated from Strathclyde University with a degree in psychology in 1996 and has always been fascinated by the gap between the way the market works in theory and the way it works in practice, and by how our deep-rooted instincts work against our best interests as investors.

He started out in journalism by writing articles about the specific business challenges facing family firms. In 2003, he took a job on the finance desk of Teletext, where he spent two years covering the markets and breaking financial news.

His work has been published in Families in Business, Shares magazine, Spear's Magazine, The Sunday Times, and The Spectator among others. He has also appeared as an expert commentator on BBC Radio 4's Today programme, BBC Radio Scotland, Newsnight, Daily Politics and Bloomberg. His first book, on contrarian investing, The Sceptical Investor, was released in March 2019. You can follow John on Twitter at @john_stepek.