skip to main content
  • *
  • *
  • *
Find Insight DIY on
* * *


Bank of England holds back on interest rates and QE

THE Monetary Policy Committee has held rates at 0.5% and quantitative easing at £375m.

Analysts had raised the prospect of the MPC starting a fresh round of quantitative easing at its November meeting.

But better-than-expected growth figures for the third quarter, which suggested GDP grew 1%, are thought to have put thoughts of further action on hold.

David Kern, chief economist at the British Chambers of Commerce, said: "Increasing QE would only provide marginal benefits for the real economy, while increasing longer-term risks of financial distortions, bubbles and higher inflation.

"Inflation is set to increase next month, and will probably fall less than initially thought in 2013. This supports arguments against using QE to limit declines in inflation. A fall in inflation would be beneficial, even if the rate moves temporarily below the 2% target. This would underpin real incomes and support demand at a time when growth prospects remain weak."

The MPC has been sitting on its hands since July when it increased the value of the Bank of England's QE programme to £375bn.

Source : James Reed – The Business Desk

07 November 2012
view more UK DIY News

Insight DIY always publishes the latest news stories before anyone else and we find it to be an invaluable source of customer and market information.

Max Crosby Browne - CEO, Home Decor

Don't miss out on all the latest, breaking news from the DIY industry