Rates go lower as cash pumped in

Link to the article: Channel 4

Last Modified: 05 Mar 2009
By: Faisal Islam

The Bank of England embarks on an economic policy that has never been tried in Britain: quantitative easing.

The term is obscure, but the implications are massive.

The bank will flood the banking system with cash, pumping in £75bn, but that sum could be doubled if the economy fails to respond.

At the same time the bank also chopped interest rates by half a per cent to just 0.5 per cent, an all-time low.