The Bank of England increased monetary stimulus on Thursday, citing the need to cushion the economy from the UK's impending exit from the European Union.
The BoE lowered interest rates by 25 basis points to a record-low 0.25 percent. It also announced plans to buy 60 billion pounds of government bonds with newly-created money over the next six months as well as 10 billion pounds of high-grade corporate debt.
"Today's decision will test the limits of monetary policy which many would argue ran out of runway some time ago," said Bill Michael, global head of financial services at KPMG.
At least investors seem impressed by the BoE's move. The FTSE 100 jumped 1.6 percent on Thursday while the pound fell against both the dollar and the euro.
However, the US stock market gave up modest gains in the morning to finish flat.
Prior to the BoE decision, Asian stocks had also risen, with the Nikkei 225 rising 1.07 percent.
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