Bank rejects more emergency support

Bank of England policymakers decided against unleashing further emergency support for the recovery yesterday despite mixed signs over the health of the economy.

By The Newsroom

Published 5th Oct 2012, 07:00 BST

The Bank’s Monetary Policy Committee (MPC) maintained interest rates at record lows of 0.5 per cent and held its quantitative easing (QE) stock at £375bn as it continues to work through £50bn of asset purchases announced in July.

The no-change decision will increase focus on next month’s meeting, at which most economists expect the Bank to pump more cash into the system through its QE programme.

Anna Leach, CBI head of economic analysis, said: “Looking ahead to November’s meeting, we think that the committee is likely to favour further asset purchases.”

There have also been doubts cast over the usefulness of more QE, with the Bank’s deputy governor Paul Tucker saying QE may be losing its “bite” and asking whether printing more money would be worth the risk to inflation.

Bank of England