Economists’ expectations have shifted sharply in recent weeks to expect a top-up to the Bank’s £200bn of asset purchases in either October or November, due to financial market turbulence and a stalling global economy.
Speaking to reporters after delivering a speech in London, Mr Broadbent said that he came close to voting to inject more stimulus into the economy this month.
“I can tell you I was reasonably close, so I don’t think it would take much more of a deterioration.
“It depends exactly what you mean by deterioration. Some of these surveys, particularly of output in the eurozone, are consistent with there being (minimal) growth,” he said.
Minutes of the Bank’s last policy meeting showed it may be about to inject more stimulus into the economy, against a backdrop of financial market turbulence and rapidly slowing growth in major economies.
Mr Broadbent said if the asset-buying programme was revived, it was likely that it would focus on buying UK government bonds, as it did first time around.
Business and consumer confidence has suffered in recent months from worries about unsustainable levels of government borrowing in the United States and the eurozone, particularly the fate of Greece, which is at risk of defaulting.
The eurozone debt situation was top of the agenda at this weekend’s International Monetary Fund meeting. Although nothing concrete came of it, Mr Broadbent said he was moderately encouraged by reports of the discussions.
“IMF meetings are not traditionally the place where those (big decisions) happen necessarily.
“I don’t think we should have expected something very precise.
“In some ways, I was at the margin quite surprised and encouraged by getting what we did,” added Mr Broadbent, a Goldman Sachs economist.
But he also warned that markets were getting sceptical of policymakers’ promises, and that the time had come for action rather than words.
In his first public speech since joining the Bank’s Monetary Policy Committee in the summer, Mr Broadbent said a weak global economy would put downward pressure on Britain’s high rate of inflation and that sterling was likely to remain weak for some time to come.
Britain’s monetary policy framework remained credible, as wage growth was slow and medium-term inflation expectations had not risen, he added.
“Slow growth in the United States, the sovereign debt crisis in the euro zone and its knock-on effects on the cost of finance for UK and European banks – all threaten a further tightening in retail credit and a further slowing in domestic activity.”