Amadeusz Juskowiak

Uk money market offered borrowing facilties

The Bank of England said it had offered borrowing facilities to those discount houses wishing to use them at 1430 GMT

The Bank also said it provided the money market 456 mln stg assistance in the afternoon session bringing its total help so far today to 493 mln stg This compares with its forecast of a shortage in the system today of around 700 mln stg

The central bank purchased bank bills outright comprising 41 mln stg in band one at 1078 pct 361 mln stg in band two at 101316 pct and 54 mln stg in band three at 1034 pct

Money market dealers said the Bank of England has recently used the offer of borrowing facilities to signal that it does not want to see an early reduction in UK Base lending rates

The Bank does this by lending to the discount houses at rates of interest higher than its prevailing money market dealing rates