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Opinion
Marcus Ashworth

Britain Reaches for the Coronavirus Bazooka

Unchained from the EU, this is the moment for Boris Johnson’s government to show the benefits of a Treasury and a central bank in lockstep.

A question of confidence.

A question of confidence.

Photographer: GLYN KIRK/AFP
Updated on

Governments’ economic policy response to the coronavirus has been a mess of one-off rate cuts, a little bit of liquidity provision and a bunch of disparate spending promises. A coordinated fiscal and monetary effort is sorely needed — if not at the supranational level (which would be ideal), then at least at the individual country level. More important still will be nimble short-term stimulus and cash flow measures to prevent companies from going bust and the economy from seizing up.

Some people might think Brexit Britain would be the last place to show the world how to manage this stuff. But, as my Bloomberg News colleague David Goodman highlighted this week, the country is starting to look like a test case for joined-up economic action on tackling the outbreak’s financial impact. Just look at Wednesday morning’s shock 50bps cut to interest rates by the Bank of England, and its package of other stimulus measures. Unchained from the rest of the European Union, which has been leaden-footed in its coronavirus response so far, this is the moment for Boris Johnson’s Tory government to show the benefits of a Treasury and a central bank that are in lockstep.