European central banks intensified their efforts to combat the recession yesterday with bolder decisions than expected to boost lending and cut interest rates to fresh lows.

The Bank of England said it would pump £50bn into the UK economy in a substantial expansion of its programme of government bond purchases, while the European Central Bank cut its main interest rate by a quarter percentage point to 1%, the lowest yet.

Furthermore, the ECB announced plans to buy €60bn (£54bn) of covered bonds, a form of long-term debt issued by banks that is usually secured against mortgages and the bank itself.

Financial Times