NEW: Bank of England cuts base rate from 0.75% to 0.25%. Monetary policy now on ultra life support- though it was never really taken off.
Despite extremely loose monetary policy growth has still been sluggish in recent years. Save for more QE or negative rates, not much else the Bank can do. We may be going into a slump, having not really had much of a boom, with few (monetary) tools available to do much about it.
Lack of monetary headroom makes an active fiscal policy the only real stimulus option available. Opposition to which was, until quite recently, the centre of Conservative political strategy and thinking. Extraordinary backdrop to #budget2020.
NEW: worse news still for the Chancellor. Growth in Q4 was 0%. That’s before the Coronavirus came along.
