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"Any views or opinions expressed in these blogs are solely those of the author and might not represent those of Access Credit Management Limited."

The UK Could Move to Negative Interest Rates

The Bank of England could be getting ready to introduce negative interest rates. Speculation about an interest rate cut has grown due to the country selling a bond with negative yield for the first time in history.

Details of the Bond

The bond in question is a £3.8 billion gilt issue that was auctioned by the Debt Management Office. It is designed to fund the government’s response to the Covid-19 crisis, and comes with a negative interest rate of 0.003%.

The British Economy Shrank by 2% in the First Quarter of 2020

As analysts continue to study the effect of the lockdown on the global economy, it has been revealed that the UK suffered a 2% contraction in the first quarter of this year. In terms of the recovery, it is now believed that it may take a different form from what was originally predicted.

The Full Details

The Office for National Statistics (ONS) released figures showing that the country’s GDP dropped by 5.8% in March. This came after January and February showed a rolling three-month growth rate of 0%.

The Bank of England Looking for a Fast Recovery

The latest Bank of England report has confirmed that the British economy is going through its biggest crisis in centuries. Yet, they have also given hope that the bounce back later in the year will be strong and fast.

The Current Situation

The update from the BoE provided the sort of devastating figures that had been expected, as the country’s businesses have suffered during the Covid-19 lockdown. Activity fell by 3% in the initial 3 months of 2020 and a 25% collapse is predicted for the second quarter.

UK PMI for April a Record Low: Grocery Sales Boom But No-one Is Buying Cars

The coronavirus pandemic and the subsequent economic impact continue to dominate the financial news around the planet. In the UK, April’s PMI collapsed and virtually no cars are being sold, but supermarkets are continuing to boom.

The PMI figures for April released by Markit show a dramatic drop from March. The composite figures showing all private sector activity nose-dived from a poor 36 in March to a disastrous 13.8 in April.

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