Bank of England is 'open for business', says Governor
25th October 2013 | News
The Bank of England governor, Mark Carney has confirmed it is now "open for business", as the Bank intends to boost the availability of finance for banks; a move which could make it easier for consumers and businesses to gain access to finance.
Mr Carney said it would offer money to banks for longer periods and widen the range of assets accepted as collateral.
In a speech on Thursday evening to celebrate the 125th anniversary of the Financial Times, Carney confirmed the Bank is overhauling the way in which it pumps cash into the markets. One of the key ways in which the Bank controls the national economy is borrowing rates and financial stability by lending private banks cash in exchange for assets.
"Our facilities are not ornamental. They are there to be used by banks to access money and high-quality collateral. We are offering money and collateral for longer terms," he said.
Carney justified the change in tactic by insisting that banks were healthier and had to meet tougher standards.
"One of the reasons to think there could be some sustainability, some traction in the recovery is that the core of the financial system has gotten a lot better," he said.
"I won’t say it’s fully healed, but it’s gotten a lot better and the rebuilding of [bank] capital is a big element of that."
The governor also expects the economy to be stronger in the second half of the year than the first half, with the Office of National Statistics (ONS) releasing its first estimate of UK GDP growth for Q3 2013 this morning, forecasting 0.8% expansion.