David Miles, Professor of Financial Economics at Imperial College Business School, appeared on BBC Radio 4's Today programme on 5 March.
He discussed the ways in which the UK government and Bank of England could most effectively help individuals and small businesses in the event of a serious outbreak of coronavirus (COVID-19).
David said that instead of cutting interest rates, a move made by the US central banking system, the Federal Reserve on 4 March, it would be more constructive to make loans easily available to those who are set to take a short-term financial hit.
"The most effective thing the Central Bank and the government can do is to try and make sure that there is targeted support for individuals by making sure that banks are able to extend loans to people who've had a short-term sharp, but temporary, hit to their income," he said.
"The thing to worry about most in terms of the impact of coronavirus on the economy is that some people will find that their income is disrupted and some companies – small companies in particular – may find it difficult to get through a period when they're not able to produce and sell."
In the US, the move to cut interest rates has had a short-term negative effect and David said he was "sceptical" about how effective it would be if the UK took the same step.
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