Following the suit of the Federal Reserve, the Bank of England decided in an unscheduled meeting to cut interest rates by 50 basis points to bolster the U.K. economy amid the rapid spread of the coronavirus.
BOE policymakers voted unanimously to cut interest rates from 0.75 percent to 0.25 percent, while held the asset purchases facility at 435 billion pounds.
The central bank also said it will confer a four-year loan scheme for small businesses to access over the next 12 months, with extra funds up to 100 billion pounds.
In addition, the Bank's Financial Policy Committee slashed the so-called counter-cyclical capital buffer for banks to zero from 1 percent.
"The Bank of England's role is to help UK businesses and households manage through an economic shock that could prove sharp and large, but should be temporary," the BOE statement said.
"Although the magnitude of the economic shock from COVID-19 is highly uncertain, activity is likely to weaken materially in the United Kingdom over the coming months," according to the statement.
The BOE monetary policy meeting was supposed to be held on March 26, with the lead of the new governor Andrew Bailey, who succeeds Mark Carney next Monday.
The U.K. economy stagnated in the fourth quarter of 2019, where the monthly GDP for January due at 09:30 GMT may signal a 0.2 percent growth.
Today, the total number of coronavirus cases in the U.K. totaled 373- a rise of 54 from the previous day- with six deaths.
As of 08:30 GMT, the GBPUSD is meanwhile trading higher at 1.2945 after hitting a bottom at 1.2829, while traded higher versus the euro at 0.8749.
UK FTSE 100 added
1.77% to 6,065.71 points, extending its rebound for a second straight session
after Monday’s sharp sell off.