Solo voice backs quantitative easing

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The pressure on Bank of England policymakers was underlined yesterday as minutes revealed their voting.

The Monetary Policy Committee (MPC) was unanimously in favour of holding interest rates at a record low of 0.5 per cent this month while only one member, David Miles, voted in favour of increasing the Bank’s quantitative easing programme from its level of £325bn.

Minutes from the May meeting said the committee could boost support if needed as fears over weak growth remained, while inflation could fall below target.

Furthermore, the MPC did not take into account the potential “extreme possibilities” associated with the eurozone crisis.

Capital Economics economist Samuel Tombs said: “It still looks like it won’t take much to tip the committee into doing more QE.”

Pressure for more stimulus measures has intensified amid the deepening in the eurozone crisis. Earlier this week, the International Monetary Fund (IMF) called on the Bank to boost the economy by lifting QE or by cutting base interest rate below 0.5 per cent.