In a remarkable about-turn, the Bank of England yesterday moved to inject liquidity into the longer-term money market by announcing plans to provide funds at three-month maturity against a wide range of collateral, including mortgages.
The first auction will be next week for £10 billion. Three further auction will be held at weekly intervals; the size to be decided in due course.
This measure was being taken "to alleviate the strains in longer-maturity money markets", said the Bank.
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