The Bank of England (BoE) voted to reduce the key interest rate to 0.1% from the previous 0.25% and to increase its holdings of UK government and corporate bonds by 200 billion GBP to 645 billion GBP.

“Most of the additional asset purchases will include UK government bonds”, the bank said in a statement. “The purchases announced today will be completed as quickly as possible, operationally, in line with an improved market performance”, adds the statement.

After the institution announced last week the introduction of a new scheme that guarantees easy and cheap access for companies to lending, now the BoE Monetary Policy Committee has also agreed to increase the size of the lending program.

The spread of Covid-19 and the measures taken to control the virus will lead to an economic shock, which may be acute and large but temporary. The BoE’s role is to help meet the needs of UK businesses and households in dealing with related economic disruption, the regulator said in a statement.

Just a week ago, the bank cut its base interest rate sharply and announced measures to help maintain the flow of funds in the economy. The management of the institution expressed fears that the coronavirus epidemic would harm economic activity.

The new BoE program is part of more state aid. Finance Minister Rishi Sunak announced a 330 billion GBP package on Tuesday evening. This corresponds to 15% of gross domestic product.