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UK: Carney’s last service – TDS

The Bank of England (BoE) announced a number of measures this morning intended to bolster policies in this afternoon’s budget. The BoE announced a rate cut, a reduction in the CCyB and a new Term Funding Scheme for SMEs (TFSME), economist at TD Securities report.

Key quotes

“The BoE’s three policy committees (MPC, FPC, and PRC) issued a joint statement today, easing policy on a number of fronts. As we broadly expected, the BoE cut Bank Rate by 50bps to 0.25%, slashed the countercyclical capital buffer (CCyB) to 0%, and introduced a new Term Funding Scheme for Small and Medium-Size Enterprises (TFSME).”

“We forecast no further easing by the BoE at this stage. With Bank Rate at 0.25%, any cut to the effective lower bound of 0.10% would be purely symbolic, and would likely accompany a broader QE package, which we do not expect at this time.”

“We have not changed our view of the UK/EU negotiations, and expect the eventual deal to disappoint. For that reason, we do not expect the MPC to be in a position to raise Bank Rate this year or next.”


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