Unlimited cash to be pumped into the economy

New Bank Of England governor Andrew Bailey is willing to pump unlimited amounts of cash into the UK economy to fight the effects of the coronavirus.

He said the Bank was literally willing to print as much money as it takes to deal with the worsening economic situation, using the new commercial paper facility which is being created.

Nothing off the table

He said: “Nothing is off the table. The Bank Of England’s not done. It’s obviously an emergency. It’s a very serious situation.

“I think we’re living in completely unparalleled times in terms of what’s happened in the last week – the closing of borders, the reduction of internal movement, the measures that preventing people from going about their daily lives, with good reason. All that of course has an effect on the economy and we’ve seen this.

It’s manifest all around us.”


He said his ambition was to ensure the defects of the virus on the economy were ‘disruptive not destructive’.

“It’s going to be a very big downturn – we know that,” he said. “We will do whatever it takes to meet the needs of the economy and the needs of the people of this country.

That’s our duty, frankly. We will meet that duty, which is why we’ve acted now twice very, very decisively.”


He wanted to emphasise the detail of the commercial paper facility announced by Chancellor Rishi Sunak, saying it would allow the Bank to print money and use it to lend directly to large companies that issued new short-term bonds.

He said it had become clear that companies both large and small were running short of cash and needed facilities to borrow quickly and cheaply.

The move will greatly increase the amount of excess reserves which would take the pressure off banks to lend because firms could effectively access cash direct from the Bank by issuing the bonds.

Financial markets

Asked if he was concerned about the volatility of the world’s financial markets he said: “We watch the market very carefully.

I always have one thing in mind. You have to ask the question: what would they have been had we not acted. That’s the important question.”

He said that though the situation is serious it is not yet time to shut the financial markets because they had not lost their integrity and their ability to price.