Bank of England Taking ‘All Necessary Steps’ to Offset Impacts of Coronavirus – Report

The organisation for Economic Cooperation and Growth predicts that the UK economy will slow down by 0.20% in 2020. This comes amid the worst recorded drop in European share prices, triggered by the global virus outbreak, since the height of the financial crash in 2008, according to analysts.

The UK’s Bank of England (BoE) sought to allay growing concerns in the market by noting, on 2 March 2020, that “all necessary steps were being taken” to mitigate against the economic impact of the coronavirus. 

The FCA, which enforces certain financial regulations, said it was working closely with financial firms to ensure they are doing what is necessary to deal with the knock-on effects of the virus. “We expect all firms to have contingency plans in place to deal with major events so that they are able to continue operating effectively”, Reuters reported, citing the FCA as saying.

BoE Governor Mark Carney told Sky News on 28 February that it is, “hard to be precise about the magnitude and, very importantly, the duration” of the economic consequences of the coronavirus but that, “the direction is slower, … the direction is down”. He explained that larger corporations are reporting that their “supply chains” are being impacted as governments start implementing quarantine and other protection measures. He also noted that the impact in the UK could already be felt, including with the visibly “less tourism”. 28 February saw the first reported case of a Brit dying from the virus, with a total of 19 cases reported across the UK by that point.

The Organisation of Economic Cooperation and Development (OECD) today lowered its economic growth forecast for 2020 from 2.9% to 2.4%, in part because of the economic consequences of the virus, fear of the virus, and measures being taken to combat it. The OECD’s revised growth predictions include 4.9% for China (down 0.8%), 0.8% for the Eurozone (down 0.3%), 1.9% for the US (down 0.1%) and 0.2% for the UK (down 0.4%). Reuters reports that European shares have seen their “worst weekly fall” since the 2008 financial crisis, and that this is “driven by rising hopes” that central banks will intervene to mitigate against the economic impacts of the virus.

Sourse: sputniknews.com