The Bank of Japan (BoJ) on Friday stuck to its monetary easing policy even as other central banks raise interest rates to tame inflation, but said it would "pay due attention" to forex markets after the yen hit a 24-year low.

The bank will hold rates at minus 0.1 per cent and continue buying unlimited government bonds to maintain a low cap on long-term yields part of a decade-old plan to boost the world's third-largest economy.

The decision, announced after a two-day policy meeting, bucks a global monetary tightening trend aimed at battling sky-high fuel and food prices caused by the Ukraine war and supply chain snarls.

Also read |&nbsp;<a href="https://www.wionews.com/world/swiss-national-bank-ready-for-more-rate-hikes-after-shock-move-488720">Swiss National Bank ready for more rate hikes after shock move</a>

Rate hikes have been led by the US Federal Reserve, which this week announced its most aggressive increase in nearly 30 years and signalled more were in the pipeline.

The European Central Bank has said it plans to start a series of increases next month, while the Bank of England announced a fifth straight increase on Thursday and Switzerland surprised markets with its own rate hike, the first since 2007.

The widening chasm between Japanese and US monetary policy this week pushed the yen to its lowest level against the dollar since 1998, a cause for increasing concern that even the central bank made reference to in its policy statement.

"It is necessary to pay due attention to developments in financial and foreign exchange markets and their impact on Japan's economic activity and prices," the BoJ said, in an unusual reference to forex movements.

After the announcement, one dollar bought 134.63 yen, up from 133.41 yen earlier in the day.

'Targeting price stability'

Bank governor Haruhiko Kuroda told reporters that the yen's rapid depreciation is "undesirable for the economy, because it has increased uncertainty about the future and made it difficult for companies to draft business plans".

However, he added that "central banks do not target exchange rates. We run monetary policy targeting price stability".

Watch |&nbsp;Global market meltdown: Series of hikes by central banks

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Kuroda said the BoJ was not considering expanding the trading range of 10-year bonds, a move analysts say could help support the yen.

A weaker currency helps Japanese exporters as it inflates repatriated profits, noted Yoshikiyo Shimamine, executive chief economist of Dai-ichi Life Research Institute.

For the BoJ, it may be that "these benefits overwhelm the negative aspects of a cheaper yen high prices for imported goods, which causes people to suffer without sufficient pay rises," he told AFP.

The bank's ultra-loose monetary policy aims to achieve two-percent inflation, a target that has been stubbornly out of reach during years of price stagnation.

In April, core consumer prices hit the target for the first time since 2015, but the BoJ has cautioned that it sees recent rising prices as a temporary and volatile trend.

Also read |&nbsp;<a href="https://www.wionews.com/world/japanese-airline-ditches-pro-russia-logo-letter-z-associated-with-russias-invasion-of-ukraine-488744">Japanese airline ditches letter 'Z' logo, which may seem pro-Russia</a>

Inflation has been rising for months in the United States and elsewhere as buoyant demand for cars and other goods clashes with supply problems caused by COVID-19 lockdowns.

The problem became dramatically worse after Russia invaded Ukraine in February and Western nations imposed steep sanctions on Moscow, sending food and fuel prices soaring, a particular problem in resource-poor Japan.

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The Bank of Japan (BoJ) on Friday stuck to its monetary easing policy even as other central banks raise interest rates to tame inflation, but said it would "pay due attention" to forex markets after the yen hit a 24-year low.

The Bank of Japan (BoJ) on Friday stuck to its monetary easing policy even as other central banks raise interest rates to tame inflation, but said it would "pay due attention" to forex markets after the yen hit a 24-year low. The bank will hold rates at minus 0.1 per cent and continue buying unlimited government bonds to maintain a low cap on long-term yields part of a decade-old plan to boost the world's third-largest economy. The decision, announced after a two-day policy meeting, bucks a global monetary tightening trend aimed at battling sky-high fuel and food prices caused by the Ukraine war and supply chain snarls. Also read | Swiss National Bank ready for more rate hikes after shock move Rate hikes have been led by the US Federal Reserve, which this week announced its most aggressive increase in nearly 30 years and signalled more were in the pipeline. The European Central Bank has said it plans to start a series of increases next month, while the Bank of England announced a fifth straight increase on Thursday and Switzerland surprised markets with its own rate hike, the first since 2007. The widening chasm between Japanese and US monetary policy this week pushed the yen to its lowest level against the dollar since 1998, a cause for increasing concern that even the central bank made reference to in its policy statement. "It is necessary to pay due attention to developments in financial and foreign exchange markets and their impact on Japan's economic activity and prices," the BoJ said, in an unusual reference to forex movements. After the announcement, one dollar bought 134.63 yen, up from 133.41 yen earlier in the day. 'Targeting price stability' Bank governor Haruhiko Kuroda told reporters that the yen's rapid depreciation is "undesirable for the economy, because it has increased uncertainty about the future and made it difficult for companies to draft business plans". However, he added that "central banks do not target exchange rates. We run monetary policy targeting price stability". Watch | Global market meltdown: Series of hikes by central banks Kuroda said the BoJ was not considering expanding the trading range of 10-year bonds, a move analysts say could help support the yen. A weaker currency helps Japanese exporters as it inflates repatriated profits, noted Yoshikiyo Shimamine, executive chief economist of Dai-ichi Life Research Institute. For the BoJ, it may be that "these benefits overwhelm the negative aspects of a cheaper yen high prices for imported goods, which causes people to suffer without sufficient pay rises," he told AFP. The bank's ultra-loose monetary policy aims to achieve two-percent inflation, a target that has been stubbornly out of reach during years of price stagnation. In April, core consumer prices hit the target for the first time since 2015, but the BoJ has cautioned that it sees recent rising prices as a temporary and volatile trend. Also read | Japanese airline ditches letter 'Z' logo, which may seem pro-Russia Inflation has been rising for months in the United States and elsewhere as buoyant demand for cars and other goods clashes with supply problems caused by COVID-19 lockdowns. The problem became dramatically worse after Russia invaded Ukraine in February and Western nations imposed steep sanctions on Moscow, sending food and fuel prices soaring, a particular problem in resource-poor Japan. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Bank of Japan keeps monetary easing despite global rate hikes

Have peanut allergies, but want to savour it? Well, don’t fret, there is a way as a clinical trial in the US has shown that adults, who have such allergies can eat small doses if they undergo fecal transplants, a hospital announced on Saturday. &nbsp;

Fecal microbiota transplanted out of non-allergic donors into allergic people, who earlier could only eat less than half a peanut before reacting, has shown positive results as the adults become resilient to two peanuts, Boston Children's Hospital said. &nbsp;

Also Read:&nbsp;<a href="https://www.wionews.com/science/new-species-of-carnivorous-dinosaur-with-short-arms-discovered-in-argentina-say-scientists-456715" hreflang="en">New species of carnivorous dinosaur with short arms discovered in Argentina, say scientists</a>

Dr Rima Rachid, lead investigator and co-director, Food Allergy Program at the hospital, said, "These results were very encouraging. A single FMT led to a significant increase in the threshold of reactivity to peanut at both one month and four months after treatment, showing that the effect was prolonged. This study is offering hope that microbiome interventions may be effective in food allergy." &nbsp;

Intestinal bacteria are a very critical part of the immune system, the researchers said. The study's samples came from OpenBiome, a non-profit stool bank in Cambridge, Massachusetts. &nbsp;

Also Read:&nbsp;<a href="https://www.wionews.com/science/evidence-of-first-ear-surgery-found-in-5300-year-old-skull-say-archaeologists-454953" hreflang="en">Evidence of first ear surgery found in 5,300-year-old skull, say archaeologists</a>

The study had included 15 participants from 18 to 33 years of age, with one participant gaining the ability to eat as many as four peanuts without a reaction. &nbsp;

(With inputs from agencies)&nbsp;

Have peanut allergies, but want to savour it? Well, don’t fret, there is a way as a clinical trial in the US has shown that adults, who have such allergies can eat small doses if they undergo fecal transplants, a hospital announced on Saturday.

Have peanut allergies, but want to savour it? Well, don’t fret, there is a way as a clinical trial in the US has shown that adults, who have such allergies can eat small doses if they undergo fecal transplants, a hospital announced on Saturday. Fecal microbiota transplanted out of non-allergic donors into allergic people, who earlier could only eat less than half a peanut before reacting, has shown positive results as the adults become resilient to two peanuts, Boston Children's Hospital said. Also Read: New species of carnivorous dinosaur with short arms discovered in Argentina, say scientists Dr Rima Rachid, lead investigator and co-director, Food Allergy Program at the hospital, said, "These results were very encouraging. A single FMT led to a significant increase in the threshold of reactivity to peanut at both one month and four months after treatment, showing that the effect was prolonged. This study is offering hope that microbiome interventions may be effective in food allergy." Intestinal bacteria are a very critical part of the immune system, the researchers said. The study's samples came from OpenBiome, a non-profit stool bank in Cambridge, Massachusetts. Also Read: Evidence of first ear surgery found in 5,300-year-old skull, say archaeologists The study had included 15 participants from 18 to 33 years of age, with one participant gaining the ability to eat as many as four peanuts without a reaction. (With inputs from agencies)

Fecal transplant can help in easing peanut allergies, says study

Despite a spike in cases to levels unseen for months,&nbsp;British Prime Minister Boris Johnson will urge caution on Monday as he is expected to confirm plans to remove nearly all the coronavirus restrictions in England from July 19.

On what he calls a 'one-way road to freedom',&nbsp;Johnson set out proposals to eliminate rules on mask-wearing and social contact&nbsp;and the instruction to work from home&nbsp;earlier this week.

The PM will announce his final decision at a news conference on Monday. In a statement released late on Sunday, he said, "The global pandemic is not over yet." 
 
"Cases will rise as we unlock, so as we confirm our plans today, our message will be clear. Caution is absolutely vital, and we must all take responsibility so we don’t undo our progress." 
 
Britain has implemented one of the world's fastest vaccination programmes, with more than 87% of adults having received at least one dose of a COVID-19 vaccine and 66% having received two. 
 
Nevertheless, recent weeks have seen a striking surge of infections, to rates unseen since the winter. 
 
The government argues that even though cases have surged, deaths and hospitalisations remain far lower than before, proof that the vaccines are saving lives and it is safer to open up.

(With inputs from agencies)

Despite a spike in cases to levels unseen for months, British Prime Minister Boris Johnson will urge caution on Monday as he is expected to confirm plans to remove nearly all the coronavirus restrictions in England from July 19.

Despite a spike in cases to levels unseen for months, British Prime Minister Boris Johnson will urge caution on Monday as he is expected to confirm plans to remove nearly all the coronavirus restrictions in England from July 19. On what he calls a 'one-way road to freedom', Johnson set out proposals to eliminate rules on mask-wearing and social contact and the instruction to work from home earlier this week. The PM will announce his final decision at a news conference on Monday. In a statement released late on Sunday, he said, "The global pandemic is not over yet." "Cases will rise as we unlock, so as we confirm our plans today, our message will be clear. Caution is absolutely vital, and we must all take responsibility so we don’t undo our progress." Britain has implemented one of the world's fastest vaccination programmes, with more than 87% of adults having received at least one dose of a COVID-19 vaccine and 66% having received two. Nevertheless, recent weeks have seen a striking surge of infections, to rates unseen since the winter. The government argues that even though cases have surged, deaths and hospitalisations remain far lower than before, proof that the vaccines are saving lives and it is safer to open up. (With inputs from agencies)

As England set for rule easing, PM Johnson warns pandemic not over

British Prime Minister Boris Johnson will set out plans for the final step of easing lockdown in England on Monday, including guidance on social distancing, face coverings and working from home, the government said. 
 
The remaining legal restrictions to prevent the spread of COVID-19 are due to be lifted on July 19, with the decision whether to go ahead scheduled for July 12. 
 
Data suggests that cases will continue to rise as restrictions are eased, but the link to hospitalisations and deaths has been weakened by the vaccination programme, the government said. 
 
People will learn to live with COVID-19 as they do already with flu, Johnson is expected to say, meaning that hospitalisations, serious illness and deaths will continue but at a much lower level than before widespread vaccination. 
 
"Thanks to the successful rollout of our vaccination programme, we are progressing cautiously through our roadmap," Johnson said in a statement. 
 
"But I must stress that the pandemic is not over and that cases will continue to rise over the coming weeks. 
 
"As we begin to learn to live with this virus, we must all continue to carefully manage the risks from COVID-19 and exercise judgement when going about our lives." 
 
The take-up of vaccines in Britain has been strong, with 86% of adults receiving a first dose and 64% receiving two doses as of Sunday, government data shows. 
 
However, cases of COVID-19 have risen in recent weeks, driven by the now-dominant Delta variant, and the final step of lockdown easing was delayed by four weeks to enable more people to be vaccinated. 
 
Data from Public Health England shows that vaccines are highly effective in preventing severe illness and hospitalisation from this variant, the government said. 
 
Housing Secretary Robert Jenrick said on Sunday face masks would no longer be mandatory after the final step in lockdown easing. 
 
(With inputs from agencies)

British Prime Minister Boris Johnson will set out plans for the final step of easing lockdown in England on Monday, including guidance on social distancing, face coverings and working from home, the government said.

British Prime Minister Boris Johnson will set out plans for the final step of easing lockdown in England on Monday, including guidance on social distancing, face coverings and working from home, the government said. The remaining legal restrictions to prevent the spread of COVID-19 are due to be lifted on July 19, with the decision whether to go ahead scheduled for July 12. Data suggests that cases will continue to rise as restrictions are eased, but the link to hospitalisations and deaths has been weakened by the vaccination programme, the government said. People will learn to live with COVID-19 as they do already with flu, Johnson is expected to say, meaning that hospitalisations, serious illness and deaths will continue but at a much lower level than before widespread vaccination. "Thanks to the successful rollout of our vaccination programme, we are progressing cautiously through our roadmap," Johnson said in a statement. "But I must stress that the pandemic is not over and that cases will continue to rise over the coming weeks. "As we begin to learn to live with this virus, we must all continue to carefully manage the risks from COVID-19 and exercise judgement when going about our lives." The take-up of vaccines in Britain has been strong, with 86% of adults receiving a first dose and 64% receiving two doses as of Sunday, government data shows. However, cases of COVID-19 have risen in recent weeks, driven by the now-dominant Delta variant, and the final step of lockdown easing was delayed by four weeks to enable more people to be vaccinated. Data from Public Health England shows that vaccines are highly effective in preventing severe illness and hospitalisation from this variant, the government said. Housing Secretary Robert Jenrick said on Sunday face masks would no longer be mandatory after the final step in lockdown easing. (With inputs from agencies)

UK PM Johnson to set out plans for final step of easing Covid lockdown

Australia's Victoria state expects to announce further easing of COVID-19 restrictions this week, acting Premier James Merlino said on Sunday, as the state reported one new locally acquired infection for a second straight day. 
 
The latest infection was a close contact of a previously reported case and had already been quarantined, Victoria's health department said. 
 
Australia's second-most-populous state has recorded 92 cases in its latest wave of COVID-19 infections, which triggered a two-week snap lockdown late last month. Victoria emerged from the lockdown on Friday as new cases declined, but some physical distancing rules remain. 
 
"My expectation is by later in the week, we will be in a position to announce further easing of restrictions for regional Victoria and ... for metropolitan Melbourne," Merlino said. 
 
Merlino added he was keen to get people back to attending sporting events and theatre, though he had no announcement to make yet in that regard. 
 
Under existing curbs, Melbourne residents can only travel up to 25 kilometres (15.5 miles) from home while outdoor gatherings are limited to 10 people. Masks are required indoors and outdoors at all public spaces. 
 
More than 3,000 primary close contacts of infected cases are already in quarantine with about 122 exposure sites listed on the Victorian government website. 
 
Australia has fared much better than many other developed countries during the pandemic, with more than 22,300 local COVID-19 cases and 910 deaths since March 2020, mostly in Victorian aged-care homes. 
 
Snap lockdowns, internal border controls and tough social distancing rules have helped it contain prior outbreaks. 
 
New South Wales, Australia's most populous state, and neighbouring Queensland are on high alert after an infected woman and her husband travelled from Victoria through several country towns in both states. 
 
With no new cases on Sunday, New South Wales, which includes the largest city, Sydney, has not reported any locally acquired infection in more than a month, while Queensland last reported cases in late March.

Australia's Victoria state expects to announce further easing of COVID-19 restrictions this week, acting Premier James Merlino said on Sunday, as the state reported one new locally acquired infection for a second straight day.

Australia's Victoria state expects to announce further easing of COVID-19 restrictions this week, acting Premier James Merlino said on Sunday, as the state reported one new locally acquired infection for a second straight day. The latest infection was a close contact of a previously reported case and had already been quarantined, Victoria's health department said. Australia's second-most-populous state has recorded 92 cases in its latest wave of COVID-19 infections, which triggered a two-week snap lockdown late last month. Victoria emerged from the lockdown on Friday as new cases declined, but some physical distancing rules remain. "My expectation is by later in the week, we will be in a position to announce further easing of restrictions for regional Victoria and ... for metropolitan Melbourne," Merlino said. Merlino added he was keen to get people back to attending sporting events and theatre, though he had no announcement to make yet in that regard. Under existing curbs, Melbourne residents can only travel up to 25 kilometres (15.5 miles) from home while outdoor gatherings are limited to 10 people. Masks are required indoors and outdoors at all public spaces. More than 3,000 primary close contacts of infected cases are already in quarantine with about 122 exposure sites listed on the Victorian government website. Australia has fared much better than many other developed countries during the pandemic, with more than 22,300 local COVID-19 cases and 910 deaths since March 2020, mostly in Victorian aged-care homes. Snap lockdowns, internal border controls and tough social distancing rules have helped it contain prior outbreaks. New South Wales, Australia's most populous state, and neighbouring Queensland are on high alert after an infected woman and her husband travelled from Victoria through several country towns in both states. With no new cases on Sunday, New South Wales, which includes the largest city, Sydney, has not reported any locally acquired infection in more than a month, while Queensland last reported cases in late March.

Australia's Victoria state expects further easing of COVID-19 curbs

Air travel in the US hit its highest mark since COVID-19 took hold more than 13 months ago, while European Union officials are proposing to ease restrictions on visitors to the continent as the vaccine sends new cases and deaths tumbling in more affluent countries.&nbsp;

The improving picture in many places contrasts with the worsening disaster in India.&nbsp;

In the US, the average number of new cases per day fell below 50,000 for the first time since October. &nbsp;

And nearly 1.67 million people were screened at US Airport checkpoints on Sunday, according to the Transportation Security Administration, the highest number since mid-March of last year.&nbsp;

Florida Governor Ron DeSantis signed legislation giving him sweeping powers to invalidate local emergency measures put in place during the outbreak. &nbsp;

While the law doesn't go into effect until July, the Republican governor said he will issue an executive order to more quickly get rid of local mask mandates.&nbsp;

"I think this creates a structure that's going to be a little bit more respectful, I think, of people's businesses, jobs, schools and personal freedom," he said.&nbsp;

Las Vegas is bustling again after casino capacity limits were raised Saturday to 80% and person-to-person distancing was dropped to 3 feet (0.9 meters). &nbsp;

New York Governor Andrew Cuomo announced that New York City's subways will begin running all night again and capacity restrictions on most businesses will end statewide in mid-May. &nbsp;

And Los Angeles County reported no coronavirus deaths on Sunday and Monday, some of which may be attributable to a lag in reporting but was nevertheless a hopeful sign that could move the county to allow an increase in capacity at events and venues, and indoor-service at bars.&nbsp;

EU officials also announced a proposal on Monday to relax restrictions on travel to the 27-nation bloc this summer, though the final decision is up to its member countries.&nbsp;

"Time to revive EU tourism industry and for cross-border friendships to rekindle safely," European Commission President Ursula von der Leyen said. “We propose to welcome again vaccinated visitors and those from countries with a good health situation."&nbsp;

Air travel in the US hit its highest mark since COVID-19 took hold more than 13 months ago, while European Union officials are proposing to ease restrictions on visitors to the continent as the vaccine sends new cases and deaths tumbling in more affluent countries.

Air travel in the US hit its highest mark since COVID-19 took hold more than 13 months ago, while European Union officials are proposing to ease restrictions on visitors to the continent as the vaccine sends new cases and deaths tumbling in more affluent countries. The improving picture in many places contrasts with the worsening disaster in India. In the US, the average number of new cases per day fell below 50,000 for the first time since October. And nearly 1.67 million people were screened at US Airport checkpoints on Sunday, according to the Transportation Security Administration, the highest number since mid-March of last year. Florida Governor Ron DeSantis signed legislation giving him sweeping powers to invalidate local emergency measures put in place during the outbreak. While the law doesn't go into effect until July, the Republican governor said he will issue an executive order to more quickly get rid of local mask mandates. "I think this creates a structure that's going to be a little bit more respectful, I think, of people's businesses, jobs, schools and personal freedom," he said. Las Vegas is bustling again after casino capacity limits were raised Saturday to 80% and person-to-person distancing was dropped to 3 feet (0.9 meters). New York Governor Andrew Cuomo announced that New York City's subways will begin running all night again and capacity restrictions on most businesses will end statewide in mid-May. And Los Angeles County reported no coronavirus deaths on Sunday and Monday, some of which may be attributable to a lag in reporting but was nevertheless a hopeful sign that could move the county to allow an increase in capacity at events and venues, and indoor-service at bars. EU officials also announced a proposal on Monday to relax restrictions on travel to the 27-nation bloc this summer, though the final decision is up to its member countries. "Time to revive EU tourism industry and for cross-border friendships to rekindle safely," European Commission President Ursula von der Leyen said. “We propose to welcome again vaccinated visitors and those from countries with a good health situation."

COVID-19: Restrictions easing in US, Europe amid disaster in India 

The Bank of England cut interest rates for the first time since 2009 on Thursday and said it will&nbsp;buy 60 billion pounds of government debt to ease the blow from Britain&#39;s June 23 vote to leave the European Union.

The central bank said it expected the economy to stagnate for the rest of 2016 and suffer weak growth throughout next year,&nbsp;and lowered its main lending rate to a record-low 0.25 per cent from 0.5 per cent, in line with market expectations.

But it also launched two new schemes, one to buy 10 billion pounds of high-grade corporate bonds and another - potentially worth up to 100 billion pounds - to ensure banks keep lending even after the cut in interest rates.

Most MPC members also expected to cut Bank Rate again this year to a rate &quot;close to, but a little above zero&quot;, if the economy performed as poorly as forecast

&quot;Following the United Kingdom&#39;s vote to leave the European Union, the exchange rate has fallen and the outlook for growth in the short to medium term has weakened markedly,&quot; the central bank said in its quarterly Inflation Report.

Policymakers were not completely united on how to respond. The cut in Bank Rate and the measure intended to ensure banks passed it on to consumers, known as the Term Funding Scheme (TFS), gained unanimous support.

But three policymakers, Kristin Forbes, Ian McCafferty and Martin Weale, opposed raising the target for quantitative easing government bond purchases to 435 billion pounds from the 375 billion total reached in late 2012.

Forbes also opposed the purchases of corporate debt - something the BoE did briefly after the financial crisis, but more to aid market functioning than to boost growth.

Many economists had expected Forbes to oppose a rate cut after she said last month that the central bank should not panic and instead wait for more data on the scale of Britain&#39;s economic slowdown.

While many business surveys show Britain&#39;s economy has slowed sharply and may even be entering recession, it is too soon for official data on how the EU vote is affecting output.

The BoE left its forecast for growth this year steady at 2.0 per cent, as the economy expanded faster in the first half of 2016 than it had expected in May.

But 2017 brings a sharp downgrade to growth of just 0.8 per cent from a previous estimate of 2.3 per cent, the biggest downgrade in growth from one Inflation Report to the next, exceeding what was seen in the financial crisis. The growth outlook for 2018 was cut to 1.8 per cent.

The BoE also revised up its inflation forecasts sharply, due to the big fall in sterling since the financial crisis, predicting it will hit 2.4 per cent in 2018 and 2019. The MPC said the costs of trying to bring it back to its 2 per cent target in the immediate future would exceed the benefit.

The Monetary Policy Committee launched the Term Funding Scheme to make sure that the lower levels of interest rates now set by the Bank of England are reflected in the costs commercial banks charge households and companies to borrow funds.

The Bank said it does not expect the scheme to lead to significantly faster aggregate loan growth, but to offset any hit to lending from a cut in official interest rates closer to zero.

Eligible institutions will be able to borrow four-year central bank reserves for an initial period of 18 months at rates close to the Bank Rate.

The lowest cost of funding, the 0.25 per cent Bank Rate, will be for banks that maintain or expand net lending to the economy and the BoE will charge a penalty rate if banks reduce net lending.

The MPC said it could adjust the terms and length of the scheme, which is funded by central bank reserves, and that the value of lending will be determined by usage of the scheme and could reach around 100 billion pounds.

New finance minister Philip Hammond, who replaced George Osborne last month, authorised the bond purchases and the TFS.

&quot;Alongside the actions the Bank is taking, I am prepared to take any necessary steps to support the economy and promote confidence,&quot; Hammond said in a letter to the central bank.

&quot;The government will set out its fiscal plans at the Autumn Statement in the normal way.&quot; released alongside its quarterly economic forecasts.

(Reuters)

The central bank said it expected the economy to stagnate for the rest of 2016 and suffer weak growth throughout next year

The Bank of England cut interest rates for the first time since 2009 on Thursday and said it will buy 60 billion pounds of government debt to ease the blow from Britain's June 23 vote to leave the European Union. The central bank said it expected the economy to stagnate for the rest of 2016 and suffer weak growth throughout next year, and lowered its main lending rate to a record-low 0.25 per cent from 0.5 per cent, in line with market expectations. But it also launched two new schemes, one to buy 10 billion pounds of high-grade corporate bonds and another - potentially worth up to 100 billion pounds - to ensure banks keep lending even after the cut in interest rates. Most MPC members also expected to cut Bank Rate again this year to a rate "close to, but a little above zero", if the economy performed as poorly as forecast "Following the United Kingdom's vote to leave the European Union, the exchange rate has fallen and the outlook for growth in the short to medium term has weakened markedly," the central bank said in its quarterly Inflation Report. Policymakers were not completely united on how to respond. The cut in Bank Rate and the measure intended to ensure banks passed it on to consumers, known as the Term Funding Scheme (TFS), gained unanimous support. But three policymakers, Kristin Forbes, Ian McCafferty and Martin Weale, opposed raising the target for quantitative easing government bond purchases to 435 billion pounds from the 375 billion total reached in late 2012. Forbes also opposed the purchases of corporate debt - something the BoE did briefly after the financial crisis, but more to aid market functioning than to boost growth. Many economists had expected Forbes to oppose a rate cut after she said last month that the central bank should not panic and instead wait for more data on the scale of Britain's economic slowdown. While many business surveys show Britain's economy has slowed sharply and may even be entering recession, it is too soon for official data on how the EU vote is affecting output. The BoE left its forecast for growth this year steady at 2.0 per cent, as the economy expanded faster in the first half of 2016 than it had expected in May. But 2017 brings a sharp downgrade to growth of just 0.8 per cent from a previous estimate of 2.3 per cent, the biggest downgrade in growth from one Inflation Report to the next, exceeding what was seen in the financial crisis. The growth outlook for 2018 was cut to 1.8 per cent. The BoE also revised up its inflation forecasts sharply, due to the big fall in sterling since the financial crisis, predicting it will hit 2.4 per cent in 2018 and 2019. The MPC said the costs of trying to bring it back to its 2 per cent target in the immediate future would exceed the benefit. The Monetary Policy Committee launched the Term Funding Scheme to make sure that the lower levels of interest rates now set by the Bank of England are reflected in the costs commercial banks charge households and companies to borrow funds. The Bank said it does not expect the scheme to lead to significantly faster aggregate loan growth, but to offset any hit to lending from a cut in official interest rates closer to zero. Eligible institutions will be able to borrow four-year central bank reserves for an initial period of 18 months at rates close to the Bank Rate. The lowest cost of funding, the 0.25 per cent Bank Rate, will be for banks that maintain or expand net lending to the economy and the BoE will charge a penalty rate if banks reduce net lending. The MPC said it could adjust the terms and length of the scheme, which is funded by central bank reserves, and that the value of lending will be determined by usage of the scheme and could reach around 100 billion pounds. New finance minister Philip Hammond, who replaced George Osborne last month, authorised the bond purchases and the TFS. "Alongside the actions the Bank is taking, I am prepared to take any necessary steps to support the economy and promote confidence," Hammond said in a letter to the central bank. "The government will set out its fiscal plans at the Autumn Statement in the normal way." released alongside its quarterly economic forecasts. (Reuters)

Bank of England cuts rates for first time since 2009, restarts bond purchases

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