The Bank of England went into full financial crisis mode on Wednesday, rushing out an announcement that the central bank was restarting its money printing presses at “whatever scale is necessary”, and later confirming it was planning up to ￡65bn of new quantitative easing.
Ministers have tried saying recent financial turbulence was global, but no one in the markets doubted the UK’s problems were the result of ￡45bn of unfunded tax cuts in chancellor Kwasi Kwarteng’s “mini” Budget last Friday.
The plunge in sterling’s value against the US dollar and spike in government bond yields since Kwarteng’s fiscal statement has thrown prime minister Liz Truss’s economic policy into acute difficulties, and the BoE’s latest QE move raised further questions.