Banks borrow £10bn from BoE

The debt auction was part of a co-ordinated action by a number of central banks to increase liquidity in financial markets. According to the Bank of England, 75% of bids were for the lowest available rate of 5.36%, below the Bank’s base rate of 5.5%. The highest rate paid was 6.6%. It is hoped the auction will help cut the rate at which banks lends money to each other, an issue which has caused financial markets to freeze and resulted in the bank run on Northern Rock. The European Central Bank (ECB) also made cash available to banks in Europe, lending a total of £249bn at a below mar...