Base rate cut

The Bank of England announced today that they have applied a widely expected 0.25% cut to the base rate.
It also announced that quantitative easing (QE) would also form part of the Banks strategy and this was largely unexpected.
I am not a fan of QE as a means to stimulate an economy and I am worried about the effect it will have on Government Bonds (Gilts) and annuity rates.
I also feel it has acted in haste I would have preferred them to let the economy ride out the current storm, particularly in view of some of the good news we are receiving related to UK based companies and new projects.
As interest rates were already at an all time low I do not think a cut of 0.25% will benefit the economy, nor will it encourage bank lending and we will probably see banks using the extra liquidity created by the QE to re capitalise their balance sheets.
I would prefer to see the Government be more creative by introducing attractive tax reliefs, looking at inward investments on the UK’s infastructure, triggering clause 50 of the Lisbon treaty and putting constructive trade agreements in place.
Our Government have a golden opportunity here I would hate to see them waste it.

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