BoE cuts bank rate to back UK businesses amid COVID-19

The Bank of England (BoE) on Wednesday took measures to help U.K. businesses and households weather possible economic disruptions due to coronavirus.  In a special meeting, the bank's Monetary Policy Committee (MPC) decided to cut its bank rate by 50 basis points to 0.25% from 0.75%, the first time this has happened since August 2016. The BoE also introduced a new term funding scheme with additional incentives for small-and medium-sized enterprises (SMEs) financed by the issuance of central bank reserves. The committee also voted unanimously to maintain the stock of U.K. government bond purchases, financed by the issuance of central bank reserves, at £435 billion ($562 billion).

The move aims to keep firms in business and people in jobs and help prevent a temporary disruption from causing longer-lasting economic harm.

Last week, citing increased risks due to the virus, the U.S. Federal Reserve lowered its benchmark interest rate by 50 basis points to the 1-1.25 band, the largest cut since the 2008 financial crisis.

Coronavirus, officially known also COVID-19, was first detected last December in Wuhan, China.

The global death toll from the virus is now over 4,260, with more than 118,100 confirmed cases, according to Johns Hopkins University in the U.S.

The virus has spread to six continents and more than 100 countries.