The Bank of England has indicated that it intends to bring to a halt its programme of quantitative easing. The Banks Monetary Police Committee voted against increasing the scale of quantitative easing, despite experts predicting that the £125 billion target would be expanded to £150 billion. The Bank indicated that it would be buying fewer government bonds in the coming months to ensure it does not meet its £125 billion target ahead of the next meeting. The Bank also decided to leave interest rates at 0.5 per cent.
The Bank commented that they expect the programme to be complete within the next month, and experts anticipate there will be a number of policies announced then to encourage the growth of the economy, rather than to slow its contraction. The Bank decided to embark on a programme of quantitative easing after its numerous interest rate cuts failed to have the desired effect in encouraging banks to lend . The scheme does appear to have had an effect, with many experts believing the economy to have already hit rock bottom, and banks showing signs of anticipating a recovery. Banks are less cautious in approving loans it seems, whilst some lenders have even been criticised for a return to their risky ways.
Bank of England Reject Expansion of Quantitative Easing
Financial Services > e-banking > Banking news
Bank of England Reject Expansion of Quantitative Easing
Fri, 10 Jul 2009
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